right from home
You've heard about how the internet lets you "shop in your pajamas." Well, the same holds true for making microloans to people in "developing" (read: third world) countries. Without even leaving
your chair, you can help impoverished people all around the globe, enabling them to start and/or build small businesses.
To those of us living comfortably in our air-conditioned homes with broadband internet connections and a Starbucks down the block, these businesses might not seem like much -- selling fruit at a
roadside stand, sewing and selling clothing, raising livestock -- but for those in need, even a couple of hundred bucks can absolutely change lives.
What Kiva is...
Kiva.org, a website launched in March 2005 by San Francisco couple Matt and Jessica Flannery, faciliates making these very small loans. But instead of
a 1:1 lender/entrepreneur ratio, Kiva takes several individual loans -- generally $25 per lender -- and combines them before disbursing the total loan amount through one of their international
microfinance partners. (The average loan is about $500 USD.)
But it's not just the size of the loans that's different -- or their method of deployment. What's really unique is how this system makes lending personal. You know who you're lending to
and why they want the money -- and you will get periodic updates on their business or project, along with the status of repayment.
For example, here's a look at where some of my own loans stand (more details are provided on other Kiva pages):
The company's fits-on-a-napkin business statement: "Kiva's mission is to connect people through lending for the sake of alleviating poverty." Or, as Bill Clinton explained during an interview during On The Record with Greta Van Susteren in March 2008, "For as little as $25, you can actually go on this website, pick a -- let's say, guy running a garage in Afghanistan -- and contribute money, and you see the effect of your money."
... and what Kiva isn't
Realize that the money you put into Kiva is not a donation, nor is it a nice little interest-earning investment. You will be paid back only what you have loaned -- assuming nobody you have lent to
defaults -- but when things go full-circle as planned, you will get that money back into your online account in 6-12 months. At that point, you can choose to lend it to someone else in need, or
simply slide it back into your pocket. (Note: In the future, the company "hopes to allow Field Partners to offer non-zero interest rates to Kiva Lenders.")
Separately, you may make a tax-deductible donation to support Kiva's operational costs as a 501(c)3 nonprofit organization. The company's overhead is also offset by PayPal (one of the founders'
former employer) who provide free payment processing, while Google and Yahoo have both gifted Kiva with no-cost keyword advertising.
The bottom line
If you're aiming to get a financial return on your loan, move on -- that's not what Kiva is about. But if you're looking to receive a "social dividend" by helping out people around the globe who really need a leg up, Kiva will stock your portfolio with plenty of warm fuzzies.
More ways to help:
About the author: Nancy Price co-founded SheKnows.com in 1999, and now serves as Executive Editor and CEM (Chief Executive of Miscellany). In the midst of growing several award-winning websites over the past decade (woo!), she also served as the editor-in-chief of two national print magazines and has continued to explore her love of entertainment by interviewing bands, musicians, actors and others.Originally from the San Francisco Bay Area, she now lives in Arizona with her four kids and more than half a ton of animals (*packaged by weight, not volume).
Have something cool, clever, charming, creative, confessional or captivating to share? You can contact Nancy via email at her first name at sheknows.com or via her personal site at andwhatsnext.com.
