Too Small to Fail: The Role of Micro-lending in Economic Recovery

Editor’s Note: The following is a guest op-ed by Eric Weaver, Opportunity Fund, and Matt Lonner, Chevron. Periodically we are approached by companies wishing to publish op-ed material and other content, sometimes we accept it, sometimes not. We were recently approached by Chevron to do this. While the oil industry is a controversial one on many levels, the willingness of Chevron to enter into dialogue with 3p’s readership impressed us and we accepted their request. When commenting, please use this as an opportunity to remember the fact that all companies are made of potential change agents and that Chevron is no different

As the President calls for a renewed focus on supporting small businesses as a crucial building block for America’s economic recovery, micro-lenders across the country are already hard at work.  Micro-loans have become a vital resource channel, giving entrepreneurs an opportunity to get their ideas off the ground, and contribute to the prosperity of their communities.

The practice of micro-finance in the U.S. is still evolving.  In fact, Aspen Institute research shows that only 2 percent of U.S. micro-finance candidates are being served.  Organizations like Opportunity Fund are quickly working to improve that ratio, investing the small amounts necessary for hard-working people with good ideas to be successful.

In today’s turbulent times, the impact of micro-loans is magnified.  For people like William Ortiz Cartagena and his 12 employees, micro-finance is a lifeline for survival – and growth. Cartagena started Gentle Parking, a San Francisco-based eco-friendly business, to support his family of five. When he needed a loan to expand last winter, Cartagena was turned down by several banks. He then came to Opportunity Fund and received a $10,000 loan, along with personalized business coaching and finance training. Since then, Cartagena has hired six more employees and is paying back his loan—all in all, a pretty good ROI for $10K.

With high loan repayment rates, a proven ability to create jobs—and a business success rate that is more than double the national small business survival rate—the micro-lending sector has a valuable role to play in the recovery. In fact, businesses working with Opportunity Fund have, on average seen a 50 percent increase in their number of employees, or an average 2.7 jobs created or sustained two years after receiving a loan. Opportunity Fund’s results show that small loans can make a significant impact on employment and cycle right back into the community to create more jobs.

Small contributions can far transcend their dollar amounts in community benefits.  It is this disproportionately positive community impact that is one of the reasons that micro-lending has become an unlikely driver of economic prosperity. Larger companies like Chevron, understanding the need and importance of this service, have stepped forward to help provide critical financial backing to aid our communities by supporting micro-lending programs.

Chevron, as a California company, saw this need firsthand as the state spiraled into recession and funding for hard working people all but disappeared. Micro-lending provides a direct and effective way to help existing small businesses thrive and help entrepreneurs get their ideas off the ground quickly—something California’s economy needs to regain its vitality. Understanding the critical need to loosen up credit and provide opportunity in our home state, Chevron partnered with nonprofits like Opportunity Fund in 2009 as part of its California Partnership initiative.

Public-private partnerships are critical to the success and scale of micro-lending in the U.S.—a topic that Opportunity Fund will be addressing this May at the Microfinance USA conference.  In the meantime, we hope to continue raising awareness and resources for micro-lending across the country, and we hope you will join us.

Eric Weaver is the Founder and CEO of Opportunity Fund, a community-based nonprofit lender that since 1995 has helped thousands of Bay Area families achieve economic stability through micro-finance and asset building programs. Matt Lonner is the manager of Global Partnerships and Programs for Chevron Corporation.

3p Contributor

TriplePundit has published articles from over 1000 contributors. If you'd like to be a guest author, please get in touch!

14 responses

  1. It is good to see support for small businesses, and I'm glad to know that Chevron is backing Opportunity Fund's good work. I admit I'm a bit puzzled by Chevron choosing this as (presumably) one of its charitable investments, as it has little, if anything, to do with Chevron's actual business.
    I'd love to see Chevron focus charitable/community investments on clean energy – directly aligned with its “energy company” mission. Better yet, focus meaningful R&D spending on clean energy and maybe do community investment in smart grid projects with municipalities. That would start to make the current Chevron ads credible.

  2. I'm glad to see Chevron supporting an organization like Opportunity Fund, but I too am not totally seeing the connection, is this just a standard charitable gift, like to the United Way? I'd love to know more about what Chevron really thinks about this kind of economic development, how it fits in with their strategy and so on. More interestingly, I'd love to hear about their position on sustainable economic development outside the US, especially in some of the places where they have oil operations – Ecuador and so on, where, let's be honest, they don't have a very good reputation for a variety of reasons.

  3. I agree that this is a good initiative and hope Cheveron does more in its direct community of Richmond – specifically funding small businesses and initiatives there. It certainly needs it.

  4. This is Justin w/ Chevron Corporation and we appreciate the opportunity to contribute to the dialog taking place on the Triple Pundit site.

    To clarify a bit further, Chevron, in our home state of California and beyond, has a focus on supporting underserved communities though partnerships with organizations making advancements in education and economic development. The California Partnership alone represents a $7 million enhancement to Chevron's community engagement investments in the state, bringing Chevron's total investments in California in 2009 to approximately $28 million.

    During this difficult economic period, the pressure on entrepreneurs and small business owners is intense – yet they are a crucial building block for the health of our economy. We see microfinance as an innovative new approach to aiding entrepreneurs and ensuring that they have every opportunity to get their ideas off the ground. Our partnerships with organizations like Opportunity Fund are more than just donations – we are collaborating to expand their reach and bring their benefits to more individuals looking to grow a business or take their own path to economic self-sufficiency.

    Justin Higgs
    Chevron Corporation

  5. It's not just America, but unbanked poor in Haiti, Africa, and India needs micro finance to save them from money lenders (read Loan sharks). For e.g. Farmers from some regions in India (Maharashtra) are born into debt and die with debt. Exorbitant interest rates kill their desire to educate their children or avail better medication.

    Best luck to Chevron.

    Mandar Marathe (A US based NGO that provides small loans to women entrepreneurs in rural India)

  6. I agree with Elizabeth's comments. I think Opportunity Fund is an outstanding organization, but I wish I saw Chevron putting more money towards GHG reduction programs, clean energy, and biofuel technology. Instead, I see cases of Chevron putting money into lobbying efforts against California's Low Carbon Fuel Standard or RFS.
    Justin, can you provide more detail about additional programs I might not be aware of focusing significant contributions to clean technology?

  7. Hello Mary,

    Thanks for the comment; we appreciate your feedback and interest in receiving more information on our efforts in Clean Technology. By way of background, Chevron is the world’s largest geothermal producer and operates one of the largest energy service companies (Chevron Energy Solutions) in the US, delivering energy efficiency and renewable projects for customers across the country. Further, Chevron Energy Solutions is one of the largest installers of solar technology in the state of California.

    In addition, we are also focused on developing advanced nonfood biofuels that can be delivered at a meaningful scale and are sustainable both environmentally and economically. However, getting emerging energy to commercial scale will require lots of work, investment, time — and technology — just as it took years to develop mature renewable energy sources such as nuclear and hydro-electric power. We project total spending in renewable energy and energy efficiency services of approximately $2.3 billion between 2010 and 2012.

    Moreover, through our partnerships with universities, such as the Massachusetts Institute of Technology and the University of California at Davis, we are supporting innovative research in the environmental and economic impacts of climate change as well as in energy efficiency and other strategies to help reduce overall GHG emissions.

    Chevron participates in joint-industry projects to enable the development and safe, widespread deployment of significantly lower-cost carbon capture and storage technologies. These projects draw on the best talent offered by the participating companies, universities, government and private research organizations to investigate a broad range of potential technologies in order to commercialize those that offer the most benefit to the participants. Chevron actively participates in the Cooperative Research Center for Greenhouse Gas Technologies ( and the CO2 Capture Project ( In addition to financial support, Chevron provides industry guidance, technical expertise, and program management. Results from these research efforts are being integrated into Chevron's Gorgon liquefied natural gas project in Australia and may be considered for potential future projects involving CO2 capture and storage.

    Hope you find this helpful.

    All the best,
    Justin Higgs
    Chevron Corporation

  8. Established in 1997, St. Gregorious Edu-Guidance is a leading education consultancy services providing exemplary service to students all over India. We deal in Admissions to all major professional courses in Premier Institutes across India. We are your one step solution for all career related needs, it may be MD, MBBS BE, BTech (ALL BRANCHES), , MDS, BDS, BPharm, BArch, MBA, MTech, MS, , PhD or any other courses. We provide personalized career solutions on an individual basis keeping in mind the aspirations of our client as well as the affordability factor.
    St. Gregorious Edu-Guidance,
    #2, 2nd Floor,
    J J Complex, Above Chemmannur Jewellers,
    Marthahalli – P O,
    Bangalore – 560037
    Contact: +91 9448516637
    +91 9886089896, +91 9449009983
    080-32416570, 41719562

  9. I too, support the thought of micro-lending. These little efforts and opportunities like this makes a great difference when its added up. That's why these shouldn't be neglected but rather promoted and strive to improve.

  10. I too, support the thought of micro-lending. These little efforts and opportunities like this makes a great difference when its added up. That's why these shouldn't be neglected but rather promoted and strive to improve.

Leave a Reply