A Kiva Loan can Change a Life

January 10, 2008

“Loans that change lives” is Kiva’s tagline. Based upon the testimonials I have read, I believe they are keeping their word. So, how can they make such a claim?

Kiva is a peer to peer lender with a charitable mission. Unlike their counterparts who pay interest to the lenders, Kiva matches small business owners around the world with lenders who want to help them get the financial backing to succeed, without paying interest.

A more traditional social lending site will loan money for home renovations, education, loan consolidation and more. But, Kiva is concentrating on the poor who want to start a business and raise their standard of living. So, they do not loan money for building a new deck, consolidating credit card debt, purchasing a new car, or whatever. It is strictly for helping others help themselves. The people borrowing the capital don’t pay interest on the loan but they do have to pay the money back.

This idea of microcredit or microloans is somewhat modeled after the successful Grameen Bank which was initiated by the winner of the 2006 Nobel Peace Prize, Professor Muhammad Yunus. Kiva has a good example to follow in Grameen Bank and adds in their own approach by making great use of technology to connect developed country lenders and 3rd world borrowers. In a recent interview the CEO of Kiva, Matt Flannery, shared Kiva’s next goal. To connect people in developing world who are willing and able to lend capital with people looking to borrow money in the same country or region.

Kiva lenders can search through over 1556 pages of journals from men and women in Bolivia, Ecuador, Uganda, and other less fortunate nations to read how the money they lend is making a difference. Kiva is constantly adding new lenders and borrowers to the site so would-be entrepreneurs world-wide can succeed and start to climb out of poverty.

Altruistic at heart, I love this idea. So many people have more money than they know what to do with, yet they take it for granted. The borrowers at Kiva simply want to have the opportunity to have a decent life.

Check out www.kiva.org. Let me know what you think.



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