TUCSON, Ariz. — John Hatch says he hit upon his Third World "poverty vaccination" while panic-stricken on a flight to Bolivia.

He had decided he could not comply with requirements of a consulting job he had accepted from the Agency for International Development, and he was scrambling to come up with a suitable substitute.

"And on my second double bourbon at 35,000 feet up flying over the Andes, I have to say it was like this thought just rolled through my body," Hatch said. "I had my calculator out and I was sketching this thing and I was doing numbers, and I arrived in La Paz with a full-blown concept."

What he had stumbled upon was village banking, a system of investment using small revolving loans to poor women to finance their private enterprise, allowing them to create savings while paying interest and qualifying for bigger loans.

The series of loans, starting at $50, is renewable over three years to a ceiling of $300, allowing recipients to reach a level at which they can qualify for commercial credit.

What Hatch envisioned on that plane five years ago has translated into 400 village banks in nine countries with more than 35,000 members. Portfolios total $1.6 million, with a 96% repayment rate. Village banks are operating in Mexico, Haiti, Thailand, Guatemala, Honduras, Costa Rica, Bolivia, Peru and El Salvador.

The concept is similar to the one behind the Grameen Bank of Bangladesh: channeling money to the impoverished, principally mothers, without the demands of commercial banks for collateral, so they can improve their families' lives.

What Hatch foresees is a body blow to world poverty through bootstrap economics.

Hatch, a one-time Peace Corps volunteer with a doctorate in economic development, is founder and president of the nonprofit Foundation for International Community Assistance, which recently moved its headquarters from Tucson to Alexandria, Va.

He says its impetus was, and remains, the thousands of children worldwide who die daily because of starvation, what he calls the sacrifice of "probably our most precious resource."

Hatch focuses on reaching mothers in the belief that strengthening them economically lets them care for their children better. There is "almost a 100% guarantee" that increased income for women will go into improvements in their children's welfare, Hatch said.