Comments on: Lending through Kiva

Question: Lending through Kiva

vers — Sun, 30 Mar 2008 08:55:51 -0800

Lending through Kiva or other organization?

In trying to do some small part to improve life for others, I'm considering heading into a territory that's new to me: microlending to individuals in developing countries. I've been reading up on Kiva.org, and would really appreciate feedback from anyone here who has made loans through them, or who has found a more effective alternative that they can recommend. I'm a bit hesitant to say this here, but I'm honestly less concerned with surety of repayment than the effectiveness and fairness of the program. If Kiva is the best option, how best to maximize the contribution that I can make (aka avoid predatory interest rates from the local bank)?

By: fogster

fogster — Sun, 30 Mar 2008 09:25:09 -0800

I actually spent two weeks in Ghana this summer, where some local merchants were funded. Unfortunately, I wasn't really aware of Kiva when I was there, so the best I can say is that I drove by a local bead shop (apparently a prestigious artisan craft) funded by them.

The one problem I've heard of with microloans is that people are getting them, and they're so destitute that they use the money to feed their family rather than starting a business... So it really comes down to who's out there on the ground managing local interaction. (I'm unable to comment on how Kiva compares to others, sadly.)

By: sharkfu

sharkfu — Sun, 30 Mar 2008 09:36:31 -0800

I've really enjoyed Kiva and I recommend it. I ended up spreading out the money I was loaning to several people and now I really enjoy when I get an email that one has repaid some money (it's not at all about the repayment, just knowing that they're doing okay).

This blog post mentions some other micro-loan organizations, although I have no experience with them.

By: Solomon

Solomon — Sun, 30 Mar 2008 09:42:20 -0800

I've been lending through Kiva for close to a year now, with no problems whatsoever. I've loaned $525, and been repaid over $300.

One thing I would say is to pay attention to the institute in the other country. Kiva has a 5 star rating system, with 5 stars being the best. Lending through one of these organisations is probably your best bet. It might also be worth you reading up on that organisation on the internet. There's also a forum that you might like to check out.

By: arse_hat

arse_hat — Sun, 30 Mar 2008 09:51:41 -0800

I lend through KIVA and I'm satisfied that they are the best way for me to make microloans. There are other organizations that do this sort of thing but none with the size and scope of KIVA. I just don't feel I could wade through all the others in order to find something more effective.

KIVA takes no money from your loan and the microfinance institution (MFI) that lends it out charges prevailing interest rates. The (MFI) makes profit only from the interest. The (MFI) needs to have a minimum of 1,000 active microfinance borrowers, a history going back more than 24 months, be legally registered in it's country, and have a least one full year of audits. (MFI)'s preferably, should also be tracked on Mix Market

Volunteers called Kiva Fellows work with the (MFI) to post updates to keep you apprised of what is happening to the people and business you have loaned money to.

Start with Risk and Due Diligence and that may answer more of your question.

By: gaspode

gaspode — Sun, 30 Mar 2008 10:01:16 -0800

I too lend with Kiva, and have nothing really else to add to the above posts. I've been very happy with them.

By: vers

vers — Sun, 30 Mar 2008 11:01:45 -0800

Thank you all for your feedback. I've taken the plunge and made my very first micro-micro-loan. I'm still open to learning more about how to make this as effective as possible, so please keep information coming!

By: arcticwoman

arcticwoman — Sun, 30 Mar 2008 11:09:15 -0800

I lend tiny little bits with Kiva, and have had only good experiences.

By: PatoPata

PatoPata — Sun, 30 Mar 2008 12:32:39 -0800

On a borrower page of the Kiva site, click the name of the field lender to learn more about them, incl a comparison of their rates and the local rate. I'm a happy Kiva lender and find that the small loan amts make it easy to donate a portion of each paycheck.

By: thinkingwoman

thinkingwoman — Sun, 30 Mar 2008 12:52:41 -0800

i've been lending to kiva for three years. i think it's great.

By: rdc

rdc — Sun, 30 Mar 2008 16:22:29 -0800

Another delighted Kiva customer.

By: mmf

mmf — Sun, 30 Mar 2008 20:14:17 -0800

Kiva is a great way to do something positive with (comparatively) small amounts of money. The best thing is getting periodic updates on how your borrowers are doing. So far, I have had only great experience, and all my loans have been paid back on time or ahead of schedule.