An Interview With Marcus Berkowitz of Grameen America

After having a conversation with my college counselor Mr. Pickett about my interest in microfinance, he recommended that I get in contact with an old friend of his who works in the industry. When I was introduced to his friend Mr. Berkowitz, he agreed to let me ask him a few questions about multiple aspects of microfinance. One stipulation was that I must paraphrase his answers in this public post, so I want to make it clear that all the information that follows is my interpretation of his writing and is my own writing.

Mr. Berkowitz works as the Vice President of Technology and Innovation at the non-profit Grameen America. Grameen America is the American branch of the original microfinance organization, Grameen Bank started in Bangladesh by Nobel Laureate Mohammed Yunus. In the U.S., they work exclusively with women. This is because of the disparity in lendings to women, as only about 4% of loans for businesses are given to women. Other benefits of lending to women include proven more responsibility in investing and better distribution of earnings among a family. For further information on this, Mr. Berkowitz suggests reading Professor Yunus' book Banker to the Poor or watching this video at 20:40.

With Mr. Berkowitz's position being focused on technology, I was very interested to learn how tech intersects with microfinance organizations. In the largest scope, it increases the access to these services. However, the role of technology also plays a large role in the transition of the microfinance model in different countries. As I mentioned previously, Professor Yunus' Grameen Bank was founded in Bangladesh, which faces very different problems than the US. The roles of technology and human work are essentially reversed. In Bangladesh, technology is inaccessible and expensive, but labor is readily accessible. However, in the U.S., labor is the most considerable cost and technology is easily obtainable. This means that technology at Grameen America is used to cover as many jobs as possible so money can be prioritized for purposes other than salary.

When I initially learned about microfinance, it seemed like a cure-all, so I then asked Mr. Berkowitz about potential problems with and concerns about microfinance. The two main concerns microfinance organizations are constantly wary of are the effectiveness of their loans and ensuring their clients don't become over-indebted. The effectiveness of microfinance loans is constantly monitored by many metrics. In response to a previous question that I had asked about the potential negative effects of new businesses in a community, Mr. Berkowitz highlighted the importance of jobs and self-employment created by small businesses. The monitoring of the level of debt clients take on is taken on mainly by government regulations.

Finally, I asked Mr. Berkowitz about his experience with cross-cultural collaboration. He specializes in Latin American development, and he was previously a Kiva fellow in Ecuador. His first note about microfinance is that the loaning does not really vary from country to country. He advised us all to be very open to criticism when we are participating in cross-cultural collaboration, as that is the only way we can truly learn.