Why I Don’t Do Micro Loans

9 03 2014


First, let me say that many dear brothers and sisters around the world make micro loans.  I am not writing nor posting this to be critical of the work of others, done in good faith, to benefit the poor in the name of Jesus.  But I am frequently asked to make micro loans by people that believe in this methodology of helping the poor.  Rather than answer this question over and over, I am just going to make this post on the topic so you know why I do what I do and if you like we can discuss it further. I don’t mean for this post to end communication nor dialog on this issue.  I am happy to consider and discuss the views of others on this point.  I am particularly happy to discuss it with those truly desiring to serve the least of these and are searching for ways to do so.  I applaud the motives and desire of those that disagree with me on this point.  We are together in our desire as brothers and sisters in our determination to help others.  If you disagree with me you are NOT my enemy, nor are you a heretic.

I would like to point out that I am asked every month to make these types of loans.  There is great need and believe it or not Westerners really believe in this method.  They will almost throw money at programs to help others learn to provide for themselves, particularly, since we in the West are the most prosperous people history has ever known and many of us believe this is due to capitalism.  So Westerners are enthusiastic about spreading capitalism all over the world to make the world a better place.  They are willing to risk their money to make this happen.  It is a noble and admirable motive.

But what does Jesus say about this process.  First let us look at the process we engage in to make a micro loan.  Some of the steps are very wise and prudent, regardless of your position on this topic. Many agencies and ministries require the applicant to submit a business plan, meaning, the borrower has to give thought and display responsible goals and planning to submit the request.  That is a very good idea.

Many loans, before being rewarded,  require borrowers to be trained in basic business practices and ethics.  Another excellent idea.  I am sure there are other great business applications and practices that are implemented by these organizations to help the borrower succeed.

Now on to Jesus. There are some scriptures that give me great pause when looking at micro loans.  The first one may surprise you.

33“Again, you have heard that the ancients were told, ‘YOU SHALL NOT MAKE FALSE VOWS, BUT SHALL FULFILL YOUR VOWS TO THE LORD.’ 34“But I say to you, make no oath at all, either by heaven, for it is the throne of God,… Matthew 5:33-34

Now this is a verse commonly explained away by theologians with the claim that there was a problem in Israel at the time of people deceiving each other through the use of vows and oaths.  While I have never read ANY primary source material from that era proving that point I am willing to entertain it.  The verse itself give credence to this theory.  However, does that mean that Jesus’ teaching on this matter is thus void for all of time due to it being a cultural problem?   But lets look at the verse a bit more closely.  First the verse quotes another verse from the OT. Verses like these below are being referenced in this statement by Jesus.

Leviticus 19:12
“‘Do not swear falsely by my name and so profane the name of your God. I am the LORD.

Numbers 30:2
When a man makes a vow to the LORD or takes an oath to obligate himself by a pledge, he must not break his word but must do everything he said.

And Jesus says plainly not to make a false oath or vow.  So He does deal with people being dishonest in the practice.  But He continues,  and says “but I say to you make no oath or vow at ALL”.  Pretty clear isn’t it.  This is one of other verses where Jesus mentions an OT command saying “you have heard it said”, then  and then adds “but I say” .  Meaning the old is passed away and now something new is being commanded.  And what does He command?  “Make no oath at all”.

But when we make a micro loan we ask them to promise to pay the loan back.  In fact we not only make them promise, we typically ask them to sign a contract or agreement, taking their simple yes or no and turning it into an oath to repay.  We are asking them to disobey Jesus and to sign, “vow” to repay.  Clearly their yes or no is not enough for us.

Jesus said to go into all the world and make disciples teaching them to obey all that He commanded.  I am making disciples and teaching them to obey Jesus.  But, when I make a micro loan and ask them to sign a contract or an agreement, I am asking them to disobey this command to make NO oath.  Jesus said if you love me you will obey my commands.  In fact He says His brothers, sisters, mothers and family, are in fact those that obey Him.  He says that those who hear only and do not obey, are building their house on the sand.  And, great will be their fall.

Not only that but Jesus has a great deal to say about lending itself.

 “If you lend to those from whom you hope to receive, what credit is that to you? Even sinners lend to sinners, to receive as much again. But love your enemies, do good, and lend, expecting nothing in return. Your reward will be great, and you will be children of the Most High; for he is kind to the ungrateful and the wicked.” — Luke 6:34-35

Give to everyone who begs from you; and if anyone takes away your goods, do not ask for them again.” —Luke 6:30

So those of us lending are in fact expecting to receive something back aren’t we? Now most micro loan people I know routinely forgive those who can’t repay.  But again, we are told that if we love Jesus we will obey His commands.  He is commanding us to loan expecting nothing back.  I know of no micro loan that does not want to be paid back and some also charge interest.  I won’t even deal with that here as even the OT forbid the charging of interest to our brothers and sisters in the Lord. 

Then we have Romans 13:8 Owe no man anything, but to love one another, for he that loveth another hath fulfilled the law.

So I am teaching obeying Jesus and I also teach we obey the scriptures in the rest of the New Testament as well.

So in the process of making a micro loan we are loaning money hoping to get something in return, asking our brothers and sisters for interest sometimes and asking for a vow to repay. I am trying to make disciples who OBEY Jesus.  But if I make micro loans I want them to make an exception. Why.  I will tell you why.

We are not trying to stumble, nor trying to make others stumble.  But we love and believe in capitalism.  Frequently when I talk about giving money to the poor to start a business I am flooded with arguments about the advantages of capitalism over communism.  I am always puzzled by this.  I never mentioned communism.  But somehow to disparage an application of capitalism I am cast into the position that the only alternative is the failed and ungodly practice of communism.  I find this troubling.  Was Jesus a communist?  Were the Apostles?  No, they were loyal Kingdom Citizens.  Loyal to King Jesus.  When the church grew in Jerusalem there were great needs and many brothers and sisters had property and goods.  Did they set up a Christian banking service?  No, there was no precedent for that in any of Jesus teachings.  Rather, they obeyed the King.  They gave to the poor.  They preferred others more than themselves.  They would not see their brother in need and say “be warmed and be filled”.  They knew that was in fact, NOT an expression of saving faith.  The Good Samaritan did not loan the wounded man money.  They required no oaths from those that they helped.  No, they sold what they had and shared among each other and there was no need among them.

Acts 4 records what they did.

   32And the congregation of those who believed were of one heart and soul; and not one of them claimed that anything belonging to him was his own, but all things were common property to them. 33And with great power the apostles were giving testimony to the resurrection of the Lord Jesus, and abundant grace was upon them all. 34For there was not a needy person among them, for all who were owners of land or houses would sell them and bring the proceeds of the sales 35and lay them at the apostles’ feet, and they would be distributed to each as any had need.

I am fully aware that many tout the great success of micro loan programs.  I must say I am very suspect of the claims of 95 to 100 percent repayments.  I know many who have engaged in micro loans and NO ONE has experienced these numbers.  Wall Street would die for those claims to be fulfilled in the business world of the West.  Even in the U.S. there are times when only one in seven new businesses make it the first two years.  Am I to believe that in the third world, that illiterate destitute people are outperforming Wall Street bankers and the American economy?  My brothers in Africa’s experience is quite different.

We are called to make disciples, but many of my brothers have seen their relationships changed more to resemble collection agents and loan officers.  Frequently, when a brother in the Lord fails in a business venture and cannot pay a loan back they are ashamed and literally hide from the lending brother.  We have actually had believers move from an area for the shame of failing a brother, never to be seen or heard from again. 

Does everyone that I make a grant to succeed? NO.  But I don’t lose brothers and sisters when they struggle.  They don’t owe me anything.  I give with the understanding  that should they be able to provide for themselves and have some left over to help others, they will do so.  An admonition in the bible.  I teach you don’t work you don’t eat, work as unto the Lord, share with those in need, sacrifice to serve and give to others.  I ask all believers I help to train three other people in the same trade.  That’s it.  Instead of hiding from me when they are behind on notes, they come to me when they are struggling and ask for advice.  Sometimes I have to help them with a hoe in my hand or picking corn.  We figure it out together.  Because they owe me nothing, they are free to engage me and be honest about the business condition and challenges.  There is no fear.  They cannot fail me.  

Well I hope you at least understand my position.  I am reminded of  statement from Jesus. 

You have a fine way of setting aside the commands of God in order to observe your own traditions! For Moses said, ‘Honor your father and mother,’ and, ‘anyone who curses his father or mother must be put to death.’ But you say that if a man says to his father or mother: ‘Whatever help you might otherwise have received from me is Corban’ (that is, a gift devoted to God), then you no longer let him do anything for his father or mother. Thus you nullify the word of God by your tradition that you have handed down.  And you do many things like that.” — Mark 7:9-13

This verse opens with an amazing statement. 

You have a fine way of setting aside the commands of God in order to observe your own traditions!

To Westerners I would make a similar statement.

“You have a fine way of set aside the teachings of Jesus, whenever it conflicts with your beloved capitalism”.

American Christianity has become very interested in what “works”.  I remember the Baptist getting all involved in buses for bringing kids to church when I was young.  Later everyone added greeters in the parking lot to make people feel more welcome when they get out of their cars.  They added gymnasiums and kids programs to bring in young couples with children.  And yes, we have decided to use our successful capitalist model in the Kingdom as well.  I do not criticize the motives on any of these practices.  I would merely remind people of a few things.

It is obedience, not success that is my goal.  I don’t care what works, if what works is in conflict with the plain teachings of Jesus.  I don’t even embrace things that work, when they don’t conflict with Jesus plain teachings.  I want to walk in His steps.  I want to do things the Jesus way.  I can take scriptures from all over the bible and make any point I want to.  A man took me to task on that statement once and I said chose a topic.  He chose tattoos.  It took me about five minutes to prove that tattoos were awesome in God’s eyes using the bible.  You see the bible says that my name is written on God’s hand and over His heart. So if God has tattoos I want to be like God.  Forget that the Israelis were told not to mark their bodies.  That was just a historical cultural problem.  See what I mean? 

Sola scriptura can be insufficient.  Even Luther, despised parts of the New Testament even why crying “sola scriptura”.  I am into solo Christo.  It is He who will judge us on that day.  It is He who I will obey.  And yes I know all the verses in the OT about this subject. 

God bless you.  I am not your enemy, I am your brother.  I hope you can at least understand my position and I am happy to visit with you on this topic any time. 




5 responses

22 07 2014
Christine (Justina) Erikson

It seems to me that signing a contract is not taking an oath, but simply making a written version of a yes or no, which is enforceable because the writing is proof the promise occurred, while one who says yes or no falsely without proof or witness can pretend this never happened.

22 07 2014

Thanks for that comment Christine. Good to hear from you. A contract is not a “simple yes or a no” as scripture requires because of several factors. One, a yes and a no are verbal simple statements. A contract is not a verbal nor a simple statement. A typical contract may involve security or penalties as a result of a breech. In the case of loaning to the poor, which we are to do EXPECTING nothing in return, we are in fact specifically defining what are our expectations. The opposite of scriptural orders commanding dealing with the poor. The subject of this post is micro loans. In a document, as a contract, we require, the person we are loaning to to engage in a commitment to fulfill obligations that are easily done verbally. It is the fact that we are not satisfied with a persons yes or no that we want to require and in fact demand a contract. In this aspect it is EXACTLY like an oath. In an oath a person is required to vow on an alter or by God Himself because it is feared that the person saying yes or no is lying or unable to fulfill the promise. . This is exactly what a contract is doing while adding, as I said before, punitive measures and protections to the lender. All violations of loaning to the poor. Not to mention that when the poor sign it, perhaps desperate for help, we are then obligating them to owe us something other than love. Another prohibition in scripture. So we use their desperate need to get them to owe us more than love, to use MORE than a yes or a no and to in fact allow us to loan EXPECTING something in return. Three strikes you are out.

24 07 2014
Purley Quirt

I would encourage you to look into the value of micro-“giving”.
This inspires people with a low income to know that even $1 a day ( in North American currency) can finance the ” work” of a young person to assist the ” mothers starting small farms” ( doing works in the village that the mother needs done ).
In this way even poor North American “givers” enjoy a meaningful connection with what they call ” building capacity” in the locals.
I have sent you a “friend request” for my Facebook page..and that will open the door for you to see visuals that explain further.

25 07 2014

Good to see you here. Well I don’t know about the program you are mentioning, but we have started businesses for as little as 10 dollars but have start 8 for under 50 dollars. Typically though we can start a well funded business for two hundred. A pretty large one for five hundred. Thanks for commenting.

27 07 2014

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