As a financial advisor for PNC Investments, Scott Krajnak ’11 provides financial planning advice to individuals and businesses. Recently, Krajnak, as a student in the Executive Master of Business Administration program, was able to use his professional experience to provide consultation to Vietnamese students managing a microfinance project developed by a Rider University professor.
Last year, Dr. Lauren Eder, professor and chair of the Information Systems and Supply Chain Management department, began working with faculty members and students from Dong Thap University and Vietnamese social workers to implement a microfinance pilot project in the heart of the Mekong Delta region of Vietnam. The collaborative microfinance project evolved from a conversation between Eder and William Campbell, a senior advisor at JPMorgan Chase. Campbell, who also shares a strong interest in microfinance in emerging and developing economies, subsequently provided his generous support to the project. Microfinance – the supply of loans, savings, and other basic financial services to the poor – is vital to the Vietnamese people who reside in these selected communities and typically live on less than the equivalent of $2 (USD) per day.
Recently, Krajnak, along with 16 other EMBA students had the opportunity to learn more about the performance of the three villages that completed the first 10-month microfinance cycle, during a recent trip to Dong Thap University in Ho Chi Minh City. The trip was part of a series of site visits coordinated through the two-week EMBA International Seminar course to Vietnam and China.
During their visit, the Rider students heard from the six students and three professors from Dong Thap University who were involved in the project. Last summer, the team selected 39 borrowers to receive $100 (USD) microloans. As part of the program, they had to agree to pay back the full loan, with interest, plus an additional monthly percentage that went into a forced savings account for them, within 10 months. Business examples included a woman requesting a loan to stabilize her fishing business and another asked for a loan to buy a baby ducks in order to raise and sell them along with their eggs.
Thirty-six of the borrowers paid back the loan and interest at the end of the 10-month cycle in May. Later, The Dong Thap University team also explained how they decided to keep the interest acquired within the communities in order to start an emergency fund. After hearing from the Dong Thap professors and students, Rider EMBA students shared ideas on how to improve the management of the finances for the project. There were also discussions for future collaboration for the next loan cycle, which is expected to begin in August.
Krajnak suggested that the social work students create more public involvement for educating small business owners and families how to save money.
“If they had someone, such as an athlete or other celebrity, who is well-known and is financially successful, speak at seminars with the social workers, they would be able to create more public interest for the microfinance project,” Krajnak said. “Overall, I was humbled by how these social workers were willing to work night and day on a project for their fellow countrymen.”
It was not the first time that the EMBA students had heard about the microfinance project. In October, EMBA students and alumni were invited to a lecture featuring Campbell. Eder said the students were so inspired by his talk that they raised $600 to support six new borrowers during the next cycle of the project, beginning in August. They presented the donation, along with English language books and DVDs to the Vietnamese students during the trip.
Eder, who served as one of the trip advisors, said the visit to Dong Thap University encouraged the EMBA students to think about service programs in the business world. In fact, a group of EMBA students, who Eder will be teaching this fall, suggested they develop a cloud-based application that the Dong Thap students can use to manage the project finances. Eder plans to incorporate the project into her information systems course in the fall.
“What was great about the project was that the Vietnamese students got experience in the field. Unlike the U.S., higher education in Vietnam is primarily lecture-based and memorization,” Eder explained. “At the same time, our EMBA students were able to gain a better understanding of how microfinance programs work. They also had a chance to consult the Vietnamese students using their own business backgrounds.”