nancing model. Given the nature of lending small amounts, the adminis- trative cost relative to the size of each loan is often quite high. And the process of screening potential clients and processing loans is a cumbersome task. Moreover, it is difficult for mi- crofinance institutions to follow con- sistent standards in granting loans, which has a direct impact on the suc- cess of their programs. And once loans are made, microfinance institutions have a hard time managing their port- folio — tracking collections, monitor- ing overdue accounts and making sure loans are used appropriately. Though microfinance works largely on personal connections and relation- ships in local communities, loan offi- cers still need a way to administer their operations and report back to their sponsors, such as NGOs, credit unions and financial institutions. Currently, the technology employed by many mi- crofinance institutions, especially smaller ones, is limited primarily to spreadsheet programs. Again, cloud computing can enable microfinance institutions to utilize more sophisti- cated, yet easy-to-deploy, IT solutions that create efficiencies and lend trans- parency to their financial management and performance. Imagine, for example, a loan officer at a small microfinance agency in Africa simply going to the Internet and logging onto a Web site to screen loan applications, manage existing loans and track collections. And imagine the ex- ecutive director or sponsor of the mi- crofinance agency going to the same Web site and logging into his or her own account to view the agency’s ag- gregate loan performance, as well as the performance of each region, office or loan officer. A few microfinance in- stitutions in Ecuador, Nicaragua, Hon- duras and India have already begun to experiment with some of these IT con- cepts in their day-to-day operations with encouraging results. Though microfinance is largely a private undertaking, not controlled by any one organization, it would be in the interest of microfinance associations and development agencies to build and promote IT solutions based on cloud computing that could be adopted more broadly. Disaster recovery. While disaster response is not explicitly one of the United Nation’s MillenniumDevelop- ment Goals or even a development ob- jective, hurricanes, earthquakes, wild- fires, floods and other disasters con- tinue to displace communities and cause tremendous damage throughout the world. The aftermath of Hurricane Katrina in the United States four years ago was a reminder that no commu- nity, even those in wealthy nations with substantial resources at their disposal, is immune to the logistical nightmare of major evacuation and recovery op- erations. Information technology can serve as a critical tool, but there is little time to develop and deploy systems in the wake of a disaster. Cloud computing can make a sig- nificant difference in mobilizing re- sources in emergencies. In fact, when the official response to Hurricane Ka- trina proved sorely insufficient, a num- ber of grassroots and community- organized initiatives sprang up. These efforts were able to leverage the power of Web-based services to get up and running quickly and with minimal re- sources. One such initiative was the creation of an online database, KatrinaList — running entirely on shared infrastruc- ture— for evacuee and survivor track- ing. Another grassroots initiative, the Broadmoor Project, was initiated by the neighborhood association of the low-lying Broadmoor section of New Orleans. The Broadmoor Project set up a database of more than 2,400 homes lo- cated in the neighborhood, with the purpose of matching available re- sources and volunteers to houses that needed repair. Using this service, the community was able to effectively tap into the thousands of volunteers who came to New Orleans with a commit- ment to help rebuild the city. These initiatives were extremely effective. What were scattered, grassroots efforts following Hurricane Katrina should become a regular and routine part of evacuation and disas- ter recovery operations — not just in the United States, but wherever nat- ural disasters hit. A number of NGOs involved in disaster recovery, includ- ing the Red Cross and the United Nations World Food Program, are al- ready piloting IT solutions running on cloud-computing infrastructure to help with mission-critical activities, such as procurement and distribution of food and supplies during natural disasters. As cloud computing takes shape, this new Internet-based IT model should be an important lever in accel- erating social and economic develop- ment. Governments, development agencies and NGOs — in partnership with the private sector — should all seize the opportunity to promote inno- vation in the developing sector by uti- lizing this new approach to the delivery and consumption of information tech- nology. ■ 50 F O R E I G N S E R V I C E J O U R N A L / S E P T E M B E R 2 0 0 9 What were scattered, grassroots efforts following Hurricane Katrina should become a regular and routine part of evacuation and disaster recovery operations.