Kiva.org: Micro-lending for the Rest of Us

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If you’re looking for a gift for someone who has everything, and who would be interested in giving something to someone who has almost nothing, then take a look at Kiva.org. It’s micro-lending for the rest of us.

Micro-lending, as you may be aware, is the concept of lending very small amounts of money to people who live in poverty so that they can entrepreneur their way out, or at least improve their standard of living significantly. Nobel Peace Prize winner Muhammad Yunus introduced the idea with Grameen Bank, and it has been growing steadily ever since in various forms. According to an article in the June 2008 Harvard Business Review some 140 million have taken advantage of micro-lending so far, but that pales in comparison to the 3 billion people who live on $2 a day or less.

Micro-lending largely has still been bank or non-profit based. What Kiva.org does is open it up for anyone to make the loans. A visit to their site allows you to read about the many people who are looking for loans, and it’s a simple process to sign up and lend them money.

As is the case with other micro-lending schemes the borrowers are almost entirely women because they are more entrepreneurial and have a much higher payback rate (come on gents, get with the program!). As your selected borrower receives more loans or makes progress on their goals, or pays you back, you get update emails.

Note that this is not a donation, it is a true loan. So you get paid back. And then you can loan the money to someone else. It’s the gift that keeps on giving.

The ten-year old son of some good friends of ours recently had his birthday and my wife gave him a $25 certificate to Kiva.org. After looking at the site he wanted to loan money to everybody! He searched for someone who had so far not received any loans, and was delighted to see that after he got the ball rolling, other people started loaning to them as well! He was just ecstatic, and it’s a double gift: the borrower benefits, and this young person has a sense that he can make a difference in a very personal way on a global problem.

In this cynical age, that is a gift in itself.

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