Family Loan Funds Offer Cash and Accountabilty

ABC Reiew
Family loan funds, one of the better ideas we’ve seen in personal finance in a long time, is the focus of a series of articles in the New York Times.
In such plans, members of an extended family contribute to a fund from which any family member can borrow. Some funds offer interest-free loans. Others offer loans at modest rates. But all of them have a particular advantage over bank loans — a sense of personal accountability.
The lack of loan defaults may have something to do with the smaller loan amounts. But there may also be something psychological in play here, too, given that if you don't make good on your debt, you're stealing from the entire family and everyone may find out about it.
We’d urge you to read the entire series. And although it’s unlikely your family offers such loans — they are a very rare phenomenon — future generations would look back on you fondly if you started one now. So get on Facebook and contact your siblings and cousins.
Or, if you just can’t stand your family, you may want to consider a kye — the loan pools popular among immigrant Korean entrepreneurs.




Family Loan Funds Offer Cash and Accountabilty

Is this a woman's world? Gender equality in Tanzania

ABC Reiew
Let's think together:Every week the World Bank team in Tanzania wants to stimulate an evidence-based debate by sharing data from recent official surveys and ask you a few questions. These posts are also published in the Tanzanian newspaper The Citizen every Sunday.Tanzanian families have been doing things differently of late. More of them have been sending their daughters to primary school and more women have become heads of families with increasing financial responsibilities. Increasingly too, more women are involved in the political arena today.  These trends can also be found in most countries in the world but they are especially visible in Tanzania as reflected by the following statistics.

• Girl's primary school attendance increased from 60 per cent to over 83 per cent between 2000/2001 and 2010/2011.
• Women today own 47 per cent of non-agricultural household enterprises in the country.
• More than a third of Parliamentary seats are occupied by women – at par with Uganda (35 per cent) and far ahead of Kenya (9.8 per cent.)
• Women count for 35 per cent of wage employment in the country.

This is good news because women's empowerment is beneficial for a country's quest for prosperity. Indeed, when women have a say in household and political decisions, have better access to education, and have access to better earning opportunities this generally results in healthier and better educated children.Yet, many Tanzanian women still suffer from discrimination and its effects compared to men:

• While about 41 per cent of girls transition to secondary school education, only 3 per cent complete the cycle.
• Salaries paid to women are on average 63 per cent lower than those paid to men. 
• When women own businesses, they make 2.4 times less profit than men.
• Women represent only 10 per cent of the political elite from the district level and below.
• In 2010, 33  per cent of Tanzanian women reported they had been subjected to physical domestic violence (in the previous 12 months)  compared to 25.1 per cent in Kenya and 14.5 per cent in Malawi.

The fate of women in Tanzania raises some questions:

• Should promoting gender equality be a priority for the Tanzanian government?
• Should specific programmes be implemented to support businesses owned by women? 
• What is contributing to the high incidence of gender violence in Tanzania?
• Should policies to encourage girls' secondary school enrolment be put in place, for example, providing financial incentives to families?
• What can be done to increase the participation of women in local politics?

Note: The statistics are extracted from the National Panel Surveys (2008/2009 and 2010/2011), the 2010 Demographic and Health Survey, the Uwezo 2011 report and the World's Women 2010 report. All are publicly available.

Quote of the Week: Salman Rushdie

ABC Reiew
"And the problem with freedom is that there -- is that people will always misuse it, you know, because not everybody's a nice guy and not everybody is smart and sophisticated and intelligent. Some people are just the opposite of that, you know. But that, you know, freedom means freedom for those people too. And so in order to defend the general subject of freedom, you have to defend the freedom of people you don't like or do things that you find ugly and cheap and tawdry like this video, you know, which is clearly not a work of any merit at all, you know, and yet the point about freedom is there has to be freedom for work without any merit at all as well. And so that's the -- that's just the simple logic of it, and I think if we believe in this value, you know, of free expression, we just have to hold the line. We just have to say, this is what we do."
--Salman Rushdie (Interviewed by Fareed Zakaria, GPS, September 23, 2012)
Photo Credit: Kyle Cassidy
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Mile High Bank to be Sold in Bankruptcy Auction

ABC Reiew
Mile High Banks. based in Longmont, Colo., will soon have a new owner. according to published reports.
Mile High’s parent company, Big Sandy Holding Co., filed for Chapter 11 bankruptcy protection on Thursday. Detailed in that filing is a plan by El Paso, Texas-based Strategic Growth Bancorp to buy Mile High, according to the Denver Post.
But American Banker reports that Strategic Growth’s planned purchase is not a done deal.
Banking observers say the bank could draw attention from other bidders. The bank has significant issues with asset quality, but its 14 branches in Denver and surrounding areas may whet the appetite of other potential buyers.
“There will absolutely be other bidders. All you have to do is look at the bidding for Bank of Choice and Community Banks of Colorado,” Adam Fiedor, a principal at St. Charles Capital in Denver, said in an interview. “There is a demand for a Denver-Boulder footprint and that is what they have.”

Mile High Bank to be Sold in Bankruptcy Auction