Microcredit company owner helps local farmers in Yunnan

Charity takes on many forms; microfinance is one of them, which many Chinese people don't know too much about.

Wang Zhenning a father of two, divorced and a retired technician is trying to support his children through school. His older daughter is away in college and his younger daughter is attending high school. He borrowed 50,000 RMB of loan to open two small convenient stores near his home.

Wang said, "If I can't get the loan, I have no money doing my business, and then I have no income. The rural credit cooperatives will seldom give out small loans. If they do, I have to wait for a long time. It is more convenient to borrow money from a microcredit company. I can get money very fast. Now with this store, I earn about two thousand RMB every month. So I can give my daughter more living expenses."

Wang is just one of the many people that represent China's small business owners who are trying to make a better living with the help of a microcredit company. Meet Jiao Ran, a young man who grew up in the US and came back to China three years ago trying to help farmers in Yunnan province located in southwest China.

Jiao said, "I came here for the tea, and to learn tea, I got to get to the farmers houses and I've got to learn from them; how to pick tea, grow tea, and this opportunity just came up! I realized that I have resources in terms of knowledge. I went to university abroad I learned about finance, I studies economics. I know the tools, and I see the need here. They are not necessarily struggling thinking how do I make my family better. And I had a light bulb moment saying you know what, I could be that bridge."

Jiao's main operation is his microcredit company in Changning County, which is one of the poorest counties in Yunnan. Over the last six months, his microcredit company has given out eighty loans ranging from five thousand to a quarter million RMB.

Microfinance was first introduced in Bangladesh by Muhammad Yunus an economist and Nobel Peace Price winner. The model was adapted in China by professor Du Xiaoshan in the early 90s. He opened the first microfinance institute in Hebei province located in northern China. But it wasn't until 2006 when the government legalized microcredit companies around the country. Now there are more than six thousand microcredit companies in operation and microloans have grown over to seven hundred billion RMB.