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Today's suggestion for Something Good comes from simplydorei who wanted to make sure we were all aware of this really cool movement taking place on the internet. I had already heard a bit about www.kiva.org and was considering promoting the concept here but hadn't gotten to it yet. Thanks to simplydorei for the nudge in the right direction. This is such a powerful way to impact the world and do Something Good for folks who are trying to improve their lives.
The first time I heard of "microfinance" was during an episode of Oprah. The talk show queen spent a few minutes interviewing Dr. Muhammad Yunus who was awarded the 2006 Nobel Peace Prize for developing a system that bestows tiny loans on poor entrepreneurs in order to support their small businesses. Of course, the word "tiny" is relative. For the folks receiving the money, it can be a life-altering sum. While Dr. Yunus works with a specific financial institution, Kiva.org has taken the loaning ability to the internet masses. They too work with financial institutions all over the world, but they also they allow us to get involved in the process. When you visit their site, you will be introduced to a variety of entrepreneurs from numerous countries who are applying for these microloans. Each applicant's profile tells a little about their business and how the money will be used. You are then encouraged to choose one (or more) to whom you would like your money to go.
For example, you may decide that you want to help Francisca Ovalle Leyja of Mexico to receive the $450 loan she is requesting to purchase merchandise that she sells as a street vendor. You are able to contribute in $25 increments, so if 18 people each decided to contribute the minimum, Francisca would receive a loan in the total amount. Along with a profile of the entrepreneur and his or her business, Kiva also tells you how much the person is requesting and reveals how much has been raised so far. Repayment terms are also listed. In Francisca's case, the terms of repayment are for five to ten months. Many of the entrepreneurs also post updates on how their business is going so that those who contributed can follow along with the experience.
So, what about repayment? At this point, Kiva has been able to post 100% repayment to investors. Once the entire loan has been repaid, all of the contributors are reimbursed for their share (without earning any interest, at this point) and are able to either keep the money or reinvest it in a new loan. Because there is a possibility of an entrepreneur defaulting on a loan, Kiva recommends that an investor spread money out over multiple recipients; thereby lowering their risk of not being repaid.
I have also noticed on several of the blogs that I read that you can get a cool graphic with information about the entrepreneur and a graph that shows how much has been raised for their particular loan. There's currently an example on the left-hand side of the Dollar Philanthropy blog (which I hope we'll be checking out in more detail later) that shows a gentleman from Azerbaijan whose $1,200 loan has currently been 56% funded. Apparently the banner changes with each refresh. At the moment, I can't seem to place one of those here but will see what I can do about getting one up on the Something Good web site in the next few weeks.
So, as Something Good that we can do today, I encourage you to check out www.kiva.org to see, not only if you can help out, but also what kinds of ideas these entrepreneurs have come up with to support their families. It's really eye opening to realize that selling food from a house in Africa or wintering over cattle in Hungary can make such a significant financial impact on these folks' lives. |
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