Kiva.org and other microloan sites (Full Version)

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stellaluna -> Kiva.org and other microloan sites (5/14/2008 2:55:28 PM)

Have you participated in any sort of microfinance? I absolutely love the idea of it! World Relief has a program, but you don't get to choose who your money goes to and I really want to be able to connect my loan with a person. That's how I found kiva.org and there was another site I can't remember the name of. Looking for input or experience.

(edited to fix website address)



GroupW -> RE: Kiva.org and other microloan sites (5/14/2008 4:09:09 PM)

I have no personal experience but have studied these programs from an economic point of view and find them extremely attractive vehicles for improving the quality of life for the lowest rung of society's socio-economic ladder. I'd also be interested in hearing some personal points of view from folks that have direct experience with this.



stellaluna -> RE: Kiva.org and other microloan sites (5/14/2008 4:14:33 PM)

I couldn't help myself. I already loaned $25 to a group of women in Uganda. [8|] [8D]

I read all the news articles and such on the site and they are all quite favorable. I discovered when I went to do the loan that they take your money through PayPal, so Kiva doesn't hold any of your financial information. When your money is repaid, you can either use it to make another loan or withdraw it.

Now I'm thinking about loaning money to a man in Mexico who needs to add a room to his house. I could spend a lot of money at this site. [:)]



GroupW -> RE: Kiva.org and other microloan sites (5/14/2008 4:34:38 PM)

quote:

ORIGINAL: stellaluna

I couldn't help myself. I already loaned $25 to a group of women in Uganda. [8|] [8D]

I read all the news articles and such on the site and they are all quite favorable. I discovered when I went to do the loan that they take your money through PayPal, so Kiva doesn't hold any of your financial information. When your money is repaid, you can either use it to make another loan or withdraw it.

Now I'm thinking about loaning money to a man in Mexico who needs to add a room to his house. I could spend a lot of money at this site. [:)]


Most microloan programs I'm familiar with are trying to provide some level of small home-business income generating ability, for example, by buying sewing machines or other equipment for families that have few income-producing opportunities. These are the one's I'm impressed by, particularly with the focus on providing women & the underclass in society with a way to step out of the deepest poverty.

I'm not so sure about the rest of them. Sounds like you did your homework though.



stellaluna -> RE: Kiva.org and other microloan sites (5/14/2008 4:42:20 PM)

Yes, most of the loans on Kiva are entrepreneurial in nature. I just saw that guy that needed the room and wanted to build a room.

Here's the information about the group I loaned money to:
quote:


The group leader of this small group is Hasifah Namalyose. She runs a small tailoring business and is requesting a loan of UGX 1,000,000 to expand her business. Hasifah is 32 years old and a single mother of two children aged 6 and 9. Her children go to school. Each week, Hasifah makes approximately UGX 60,000 in profits and with the extra profits from her loan, she hopes to be able to save for her childrens' school fees.

Hasifah has taken a previous loan from BRAC Uganda in the amount of UGX 400,000 to invest it in business and the loan was paid back on time. Hasifah is joined in her small group by Rose Nayiga, Sartine Kobujurizi, Agnes Omojong, and Molly Namakula. Rose Nayiga runs a retail shop and is requesting a loan of UGX 400,000 to increase her stock. Sartine Kobujurizi sells milk and is requesting a loan of UGX 500,000 to buy more milk cans. Agnes Omojong runs a salon and is requesting a loan of UGX 500,000 to open another salon in a diferent location. Molly Namakula sells food in a canteen and is requesting a loan of UGX 400,000 to increase her stock in the canteen.



GroupW -> RE: Kiva.org and other microloan sites (5/14/2008 4:46:56 PM)

Yup. That's what I'm familiar with, particularly the focus on women who would otherwise be dependent on a social structure for support that can be abusive toward our fairer sex.

Generally, they've been very effective (depending on the degree of active support from the microloan agency. Along with the micro loan, the better agencies offer some degree of business counseling & education.)



MyMasquerade -> RE: Kiva.org and other microloan sites (5/16/2008 1:39:05 PM)

Are these legit? I have never heard of this. How do you get on the to be loaned to?



GroupW -> RE: Kiva.org and other microloan sites (5/16/2008 2:42:07 PM)

quote:

ORIGINAL: MyMasquerade

Are these legit? I have never heard of this. How do you get on the to be loaned to?

Some are effective, some are not. Most of the good programs have people on the ground locally that can offer sound business advice to go along with the micro loans. The better programs focus on providing the dis-empowered and disenfranchised (largely women, lower social castes, etc) with the equipment and education to form a paying home business. To be effective, the loan programs need to be combined with an education and oversight program such that the people receiving the money actually use it to pursue the purpose for the loan, pursue it responsibly, and pursue it successfully.



stellaluna -> RE: Kiva.org and other microloan sites (5/17/2008 9:29:24 AM)

quote:

ORIGINAL: MyMasquerade
Are these legit? I have never heard of this. How do you get on the to be loaned to?

The most successful programs I've come across work only with those in developing countries. I did check into loaning money to people in the US and the microfinance programs available are not set up in such a way that individuals can contribute. For example, there is a program through the Small Business Administration and another through Citigroup. If you want to be loaned to, I guess you would do the same research as anyone who wanted to loan.

Call me cynical, but somehow I don't think it would work in the US and maybe other places either. I think Americans are too used to not repaying. Look at our debt numbers. That's exactly what makes it difficult for people to get traditional loans--poor credit risk. When I loaned money to the women in Uganda I had this information to go on: total loans to Ugandan men and women equaled $1,214,900; delinquency rate 0%; default rate 0%. That's unheard of here. (Otherwise we wouldn't be in the mortgage crisis we're in.)



ames01 -> RE: Kiva.org and other microloan sites (9/20/2008 7:39:56 PM)

I came across this thread after doing a search on microfinance. Stellaluna, now that you have been involved with this for a few months, how has it been going? Can you update us on your experiences? This sounds like a great idea.



stellaluna -> RE: Kiva.org and other microloan sites (9/21/2008 10:26:24 AM)

I completely forgot about this thread. lol

Well, I have loaned $25 a month since my first post. Right now I have the following loans:
1) Uganda--group of five women--tailoring--25% repaid
2) Peru--one woman--clothing sales--75% repaid
3) Mexico--one man--construction--17% repaid
4) Sierra Leone--group of three women, one man--clothing sales--20% repaid
5) Dominican Republic--group of 15 people--clothing sales--0% repaid
6) Mexico--one man--housing--0% repaid

There have been some changes since I started loaning through Kiva. It used to be that you didn't get any of your money back until the entire loan had been repaid. Now you get part of your loan back each month when entrepreneurs make their payments. As always, that money goes into your Kiva credit and you can reloan it or withdraw it.

Also, the last couple of months there has been a major influx of loaners, so there have been a few times that ALL the entrepreneurs have received loans and no one is waiting! That is kind of a cool thing.

When I first started loaning, I had in mind a particular kind of person I wanted to lend to. Now I know better. [;)] Now I know that God will put entrepreneurs on my heart when I see their loan requests, even if they aren't the people I expected to loan money to. [:D]

Overall, I love being involved with Kiva. I love thinking that the little bit of money I send, and combining efforts with strangers, can make a real difference for someone halfway across the world.



ames01 -> RE: Kiva.org and other microloan sites (9/21/2008 7:44:09 PM)

Thanks for the info! Everything I've read so far about microfinance sounds really promising to help those living in poverty. I had been looking into Opportunity International for a while, so I went ahead and contributed towards a few loans through that organization. Kiva sounds like a good option to look into as well. I'm excited to see how it all works out.



Auben -> RE: Kiva.org and other microloan sites (9/22/2008 9:51:21 AM)

Hey, cool! I mentioned this in my blog last month. I had no idea we had a thread for this.



stellaluna -> RE: Kiva.org and other microloan sites (9/22/2008 10:27:15 AM)

Well, it's not much of a thread. It never really took off after I started it. [8D]



ta_mosquito -> RE: Kiva.org and other microloan sites (9/22/2008 10:33:00 AM)

Wow. This sounds really cool. It's really getting into the nitty gritty of giving instead of writing a check and never thinking about it again. It reminds me of the "I was hungry, you clothed me; I was thirsty, you gave me drink" principle - on a more individual level than a lot of other programs.



stellaluna -> RE: Kiva.org and other microloan sites (9/22/2008 10:41:54 AM)

One thing I wish Kiva would do is give more updates from borrowers...although I guess that's more on the field partners than on Kiva itself.

For those who don't understand how Kiva works...

* Kiva has "field partners" all over the world. These field partners are the direct link to borrowers. They generally work under their own organizational names and handle loans for a particular area, region or country. The field partners are the ones that distribute loans and collect payments. Many of them also work with entrepreneurs to educate them on ways to improve their businesses.

* When a loan is requested, the field partner hands it over to Kiva, which posts it on the website and makes it available to lenders. Each loan request has a picture of the borrower, a narrative about the borrower's life and business and details about why the loan is needed. The borrower page shows the amount of the loan, the repayment terms and details about the field partner organization, which includes repayment and default rates.

* If you decide to lend, you choose the amount you want to lend in $25 increments. All of the money you lend is transferred via PayPal, so your financial information is never revealed to Kiva. As your money is repaid, you get "Kiva credit." You can reloan this money or have it withdrawn into your PayPal account. You do not earn interest; you just get back the amount of your original loan.

* Each loan is raised over a 25 day period, although most are funded in about a week. When the loan is fully-funded and distributed, a note will go up on the lender page and lenders are notified via email. Throughout the repayment period, the field partner has the option of posting updates to the lender pages. Usually they will do at least one, to tell lenders how their money is being used. I think it would be cool if they posted more often, but some of them are managing dozens of loans, so it's probably not possible. You can also respond to the posts on the lender pages, although not many people do.

* You can loan individually or as part of a team. There are lending teams already on Kiva that you can join, or you can create your own.

If anyone has a question, I'll try my best to answer it.



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