Initially funded on little more than an explanation and a request, an educational loan program for impoverished young people looks to be transforming the lives of tens of thousands around the globe.

By the end of this year, the program, known to members of The Church of Jesus Christ of Latter-day Saints as the Perpetual Education Fund, will have made 24,000 loans at an average of $860 each to disadvantaged Latter-day Saints, using only the interest earnings from the fund.

The program's genesis?

Latter-day Saints believe it was inspiration from God.

President Gordon B. Hinckley, who will preside at the 175th Semiannual General Conference of The Church of Jesus Christ of Latter-day Saints this weekend, was the catalyst for the loan program.

He announced its formation during a similar conference on March 31, 2001, telling Latter-day Saints that it "entails no new organization, no new personnel except a volunteer director and secretary. It will cost essentially nothing to administer."

He then invited Latter-day Saints and others to contribute, noting the fund would continue in perpetuity because it would loan only the interest generated on what he projected would be a continually growing principal.

"We shall begin modestly, commencing this fall. We can envision the time when this program will benefit a very substantial number."

Elder John K. Carmack, who administers the fund for the church, believes those words were prophetic.

The fund provided a relative handful of loans in 2001, but the numbers have grown exponentially ever since, he said. By the end of 2005, he anticipates 24,000 loans will have been approved for young Latter-day Saints in nearly three dozen nations.

Recipients are scattered throughout Mexico, Central and South America, the Philippines, the Caribbean, Cambodia, Mongolia and India, with plans to expand into west Africa, central Europe, Russia, Tonga, Samoa and Fiji, Elder Carmack said.

Applicants work through local LDS seminary and institute personnel, who provide the oversight, screening and support for the program, in addition to their regular teaching assignments. Applications are forwarded to Salt Lake City, where a loan committee meets twice monthly to discuss approval. Loan money to pay for tuition and books is then sent directly to the college or training facility the applicant will attend.

Applicants must be certified by local church leaders as active and worthy church members, "just as if they were going on a mission. The bishop decides whether the person is a worthy and active member that we should consider," and LDS Institute personnel must also certify that applicants are actively participating in religion classes.

Elder Carmack said the program "basically brings more justice and unity into the church and among the members, where those who have help those who have not." He declined to talk about how much money is in the fund, or how much is added to it annually, but Elder Carmack said the fund continues to attract "tremendous donations. So far, it's keeping up with our need."

Even without official figures, the math is impressive: With 24,000 loans at an average of $860 each, estimates are the church has lent roughly $20 million to disadvantaged Latter-day Saints, using only earnings from the fund.

Most of the money comes from church members in wards and branches throughout the world, and hundreds of thousands of people have contributed to date, he said.

Loan recipients must have a viable career goal, determined in conjunction with local LDS employment resource center personnel, and meet the admission requirements to an approved training program. Most of the loans are given for education in vocation and technical skills, but a few have been approved for applicants entering dental, medical or legal training programs.

Recent career training options requested include: school teacher, network administrator, computer science, systems analyst, human resource specialist, flight attendant, managerial, clinical lab technician, computer support technician, university faculty, political analyst, physician's assistant, physical and corrective therapy assistant, lawyer and judge.

During a recent loan committee meeting, Elder Carmack said 171 loan applications were received from Brazil, where the church has more than 1 million members. "The average person applying for a loan is making $179 per month, and they're expected to earn an average of $756 per month when they're through" with the training. "They'll take an average of 2.6 years to complete their education, and we'll require them to pay 4.9 percent of their expected income" to satisfy the loan.

The loan fund charges 3 percent interest, which doesn't begin to accrue until 90 days after they've completed their training.

The fund currently averages a 62 percent loan repayment rate. "Our goal for this year is to raise that to 70 percent, and eventually to get to 90 percent," he said, while understanding that "these are people who never have had a loan or bank account and have never had these opportunities or experiences before."

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He believes the fund is performing as President Hinckley said it would, training faithful church members who "will pay their tithes and offerings, and the church will be much the stronger for their presence in the areas where they live. . . . It will become a blessing to all whose lives it touches — to the young men and women, to their future families, to the church that will be blessed with their strong local leadership."

With national and international programs aimed at eliminating poverty, Elder Carmack said he believes the fund provides a realistic way to work toward that goal within the church itself. "This is one way to get there. It may be the key."


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