Yise van der Schoot
VANCOUVER — The global economy should operate with everyone's benefit in mind, not just those living in rich countries, Pope Benedict stressed in his 2009 encyclical Caritas in Veritate.
Every economic decision, said the pope, has a moral consequence.
"The conviction that the economy must be autonomous, that it must be shielded from `influences' of a moral character, has led man to abuse the economic process in a thoroughly destructive way," said the pope.
Global wealth, he added, is badly in need of redistribution.
The pope urged wealthy nations to devote a larger share of their gross domestic product to development aid.
The pope pointed to business initiatives such as micro-finance, consumer co-operatives and socially responsible business ventures.
Micro-finance has grown enormously as a way to help small business owners in developing countries expand their businesses and employ others. The loans are then repaid.
Oikocredit, a micro-finance institution based in the Netherlands, works in 71 countries around the world with 800 partners. Projects financed by Oikocredit reach more than 17 million people worldwide.
Oikocredit Canada-West recently welcomed Oikocredit investment relations officer Yise van der Schoot to B.C. to meet with people from churches, investor groups and credit unions to discuss how micro-finance works.
Oikocredit investors, said van der Schoot, give loans with affordable, market-related interest rates to people with little or no collateral.
The spin-off from the loans helps small business owners educate their children, obtain better housing and improve their lives as well as the lives of those whom they employ and those they are able to patronize because they have an income.
"Micro-credit is not charity," van der Schoot emphasized, "but a way to help people create a better life."
The repayment rate from Oikocredit loans is 98 per cent, far higher than the rate of student loan repayment in North America, said van der Schoot.
The financial crisis, she said, has caused an upsurge of interest in micro-finance because it encourages relationships between the people lending the money and those who borrow.
"It has actually done us some good, because people are becoming more conscious of how they are using their money. Many have lost confidence in the commercial banks and investment houses because of mismanagement issues.
"Micro-finance allows lenders to support a social mission agenda, which many people prefer."
Oikocredit, she told The B.C. Catholic, is currently focusing on loans to small businesses in Africa "because it's our mission to reach the poorest of the poor.
"We have all kinds of checks and balances and loan criteria in place, but it's a challenge because the infrastructure in African countries is so disorganized. However, our contacts are growing. We are seeing lots of successes."
More information is available at www.oikocredit.org.