Kiva

A common response when I tell people I’m working with a microfinance organization is: “Oh, you mean, like Kiva?” Many people have heard of this organization – Bill Clinton and Oprah have spoken of and supported Kiva – and the organization is strongly associated with microfinance.

Rising in popularity, Kiva is an organization and web site that aims to connect individual donors with individual entrepreneurs – people can lend money over the internet to individual business owners in the developing world. The idea behind Kiva is that individuals can see their actual donation (in the form of a loan) at work in another individuals’ life.

On the Kiva site, you’ll find lists of individual entrepreneurs all around the world; entrepreneurs who have a small business or an idea, and are looking for a micro-loan to finance their idea. Lenders read through profiles of the entrepreneurs, and chose one they would like to support. Lenders offer a loan, and Kiva aggregates the capital from individual lenders to raise the money for the loan. The borrowers pay back their loans, and once the loan is fully re-paid, lenders can withdraw their principal, or re-loan it to another entrepreneur. With journal entries and pictures, people can see how their piece of the loan is helping entrepreneurs.

According to the website, Kiva is a person-to-person lending site that connects people through lending for the sake of alleviating poverty. Kiva “lets you lend to a specific entrepreneur in the developing world – empowering them to lift themselves out of poverty.”

Also according to its website, as of May 5^th, Kiva has $US 29,628,560 of loans from 285,585 lenders. Its re-payment rate is 99.71%. These are big numbers, but Kiva deals essentially with small loans that add up to big numbers. The average total amount loaned per Kiva lender is US$ 104, and the average loan to an entrepreneur is US$ 510.

Kiva doesn’t work directly with the entrepreneurs around the world; instead they partner with existing microfinance organizations that are already working with local entrepreneurs – called Field Partners. The Fundación Adelante was one of Kiva’s first four Field Partners. We don’t have any entrepreneurs listed on Kiva right now, but we’re currently talking to Kiva about listing some of our clients on their web site. It’s a great way for people who want to support Adelante to directly see the impact of their loan in the lives of the women they are supporting.

For more info on Kiva, see their website: kiva.org

References: kiva.org and wikipedia