Kiva sends microloans to every developing-world project on its list
Andy sez, "Kiva.org is an organization that lets their users fund micro loans to business people in countries with weak economies. It has managed to find funding for every business on their directory. This has left them scrambling to find other needy business owners in under privileged countries but I think they consider this a very good problem to have."
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(Thanks, Andy!)
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Welcome to microfinance.
Kiva is nice, but (obviously) it doesn't scale very well. Without wishing to lecture on microfinance, the "traditional" way of doing it has always involved microfinance institutions (think of them as banks) with loan officers who - instead of sitting behind nice desks - go out into the field to work with clients.
The challenge in microfinance has (at least since I've worked in open source microfinance technology) been one of outreach: there are this many underserved clients, how do we reach them?
Some microfinance schemes (I think kiva is one) also don't work clearly with interest; I understand that the charity model of international development dies hard, but this is unsustainable and simply perpetuates the social and economic conditions which led to poverty to begin with.
Kiva is a great way of getting the Average Joe involved in microfinance, but in terms of impact? I can name many microfinance institutions in the Middle East alone which outstrip it for outreach.
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My family has been using Kiva to make loans for nearly a year. My kids love going through the applications and selecting people to loan money to. It's a wonderful idea.
That's great news for Kiva - I've supported them since I first read about them on boingboing 3? years ago.
Josef: I've read and re-read your comments and I'm confused. Why do you say kiva (which doesn't charge interest) "perpetuates the social and economic conditions which led to poverty to begin with"?
I thought just the opposite was true; Kiva allows people to start up their own means of support and lift themselves out of poverty.
- lmb
For anyone that's interested in supporting grassroots projects around the world, I'd also suggest checking out GlobalGiving, http://www.globalgiving.com. Like Kiva, there are a number of incredible projects on there and all donations are tax deductible. One of my favorites is for $100 you can buy a pig that will be used to generate enough income for a family to not have to send their daughter into forced/bonded labor.
http://www.globalgiving.com/1649
It's worth checking out!
I'm a loaner on Kiva and I love it. It's a great site.
I use Kiva to finance a Bulgarian bra and panty salesman named Artur Sargisian. Business must be good because he's been making regular payments. Neat project.
http://www.thenewfreedom.net/wp/2007/02/01/i-own-a-small-peice-of-a-bulgarian-mans-soul/
Sounds like a great idea, and it's wonderful that they're meeting with such success. I do find their current policy a bit odd, though: "Due to overwhelming user interest, we are temporarily limiting loan contributions to $25 per business so that everyone has a chance to make a Kiva loan. We appreciate your patience and look forward to removing this limit soon!"
I ... guess it's sensible to limit how much people can contribute to any one business to keep everybody involved and interested, but at a 'gut-feeling' level it just seems ... strange. But, well, I suppose being a victim of their own success is better than the alternative ...
@ Stacy C:
The limit is only temporary (from what they say on their web site):
"Due to overwhelming user interest, we are temporarily limiting loan contributions to $25 per business so that everyone has a chance to make a Kiva loan. We appreciate your patience and look forward to removing this limit soon!"
I would imagine that the national press coverage has maxed them out in terms of finding needy businesses. Check back in a month or so and I'm sure you'll find plenty of new businesses to invest in.