P2P microfinancing for the developing world
Ever dreamt of becoming a venture capitalist? Enter Kiva… a new web site that allows individuals to make small loans to low-income entrepreneurs in the developing world. You’ll be surprised to find out what a $100 loan will do to empower the working poor. Here’s how it works:
- Lenders pick a business and make a loan using their credit card
- Kiva transfers funds to local partners. Partner disburses loans to each business
- Over time, partner collects repayments and provides business updates at Kiva.org
- Funders are returned to lender. Kiva lender may withdraw or re-loan
This is not called a micro-credit concept for nothing. Micro finance payments typically accrue higher interest rates, and what this means is that you can put your money to work and help someone at the same time (have your cake and eat it). This is a very democratic way of helping people in the developing world – making sure the money lands in the right hands, instead of corrupt officials and greedy non-governmental organizations. Put your money to work!
Hi David,
Thanks for the timely post. With the recent awarding of the Nobel Peace prize to Muhammad Yunus and the Grameen Bank, the general awareness towards microfinance as an effective tool to eradicate poverty has been heightened. Thanks also for writing about Kiva. You’ve given your readers a unique opportunity to truly “put their money to work” in a relevant and practical manner. Thanks for spreading the good word about Kiva!
Tim (volunteer with Kiva.org)
It is called the ‘Fortune at the bottom of the pyramid’. Low income markets present a huge opportunity for new business.