Should We Be Focused on Rural Areas in the Developing World?

Microfinance has largely become a city-based endeavor, but one example suggests it would be more useful if focused on rural communities


Microfinance -- the practice of personal small loans to spur creativity in developing nations -- has well-known rural roots. Of late, I had assumed that the practice had become a city-based endeavor, in concert with other programs, targeting the world's burgeoning urban populations.

Time spent in Africa earlier in the year did not change that perception.

However, after following up with community economic development friends back home, I learned that fostering a rural middle class should spur reflection among those passionate about cities. Sometimes, finding a way to keep a meaningful rural existence trumps city life.

According to Cole Hoover, director of programs for Seattle's Lumana, whose work focuses in rural Ghana:

Although there is an amazing potential for growth and innovation in cities and urban areas in Africa, I think it is important to recognize that it's not for everyone. Many people do not have the resources or connections to migrate to cities and some, quite frankly, even when possible, do not want to do so.

Lumana is a small, Seattle-based organization founded by young, multi-national entrepreneurs. In Ghana, Lumana helps people reach their personal and financial goals through microfinance, business education, planning for savings, and local mentorship. Lumana also employs four Ghanaians who work in rural areas, out of choice and for connection with their communities.

According to Hoover, these Ghanaians have affinity for their home villages, fellow residents, and a slower pace of life. In addition, they take pride in helping to lead operations that can make rural areas more livable.

Hoover's observations confirm Lumana's rural-based initiatives:

There is an amazing amount of people who appreciate their traditional way of life and the slower pace that rural life allows. We initially got involved working in rural Africa because its people are some of the most underserved in the world. It is our goal to use our programs to do community economic development that increases opportunities for rural people and makes it easier for them to thrive in the villages they choose to call home.

Today, microfinance work focuses on cities more often than not, leaving a huge amount of underserved populations in rural Africa, said Samantha Rayner, executive director of Lumana. Rural areas experience poverty based on disconnection from services and resources.


"Poverty does not just mean having no money," Rayner explained. "It means having no opportunities."

Hoover told the story of "Anna" from the village of Dzita. Anna was a case study of Lumana's accomplishments since 2010, helping rural Africans get limited available resources, including access to basic services, such as health care, drinking water, education, and a consistent income.

It was in rural Dzita, not a large city like Accra, that Lumana also helped villagers understand how to make their businesses more profitable and to prepare for unforeseen emergencies by creating specific savings plans for education, future businesses, and emergencies.

In addition, in a three-day class, villagers typically learn to better understand supply chains, small and medium-sized businesses, and how they influence and affect the total economies of the rural communities.

"Rural Africa is an amazingly beautiful place," Hoover explained. "You see and feel it in the bright-colored clothing, laid back way of life, and support of a close-knit community of hardworking and collectively-minded people"

I queried Hoover on the fundamental precepts of urban poverty, something I saw firsthand in several instances overseas, and considered in recent writing about Gary Hustwit's film, Urbanized.

Presented by

Charles R. Wolfe is an attorney in Seattle, where he focuses on land use and environmental law and permitting, including the use of innovative land use regulatory tools and sustainable development techniques.

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