Posts Tagged ‘Micro-lending’

Kiva Update

Wednesday, July 11th, 2007

I’ve posted on my experience with micro-lending through Kiva in the past including here.

I started my loan portfolio in October 2006 with the plan of adding a small amount of new money each month and making a new loan or two from that amount. At some point, loans would begin to be repaid. When they did, I’d roll those funds back into new loans instead of adding new funds. At some point my hope is that no new funds will be needed.

Well, in June and July some of my first loans were paid off and so I didn’t have to add any new funds in those two month. A number of other loans are getting close to being paid back, so there may not be to much need for additional dollar, which will help my budget :-).

According to Kiva, here is what my loan portfolio looks like:

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Portfolio Distribution

Gender
Female 68.8%
Male 31.3%
Country
Ecuador 43.8%
Kenya 12.5%
Nigeria 6.3%
Togo 6.3%
Afghanistan 6.3%
Bulgaria 6.3%
Mozambique 6.3%
Ghana 6.3%
Honduras 6.3%
Sector
Retail 31.3%
Food 31.3%
Clothing 18.8%
Agriculture 12.5%
Services 6.3%

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If you haven’t looked into micro-lending as one way to help reduce world poverty, please do check it out by clicking on the Kiva banner in the right hand column.

Micro-Lenders Evaluated

Tuesday, March 20th, 2007

Slate magazine recently asked the question, “Which microlenders cater to individual donors? And which is the most satisfying place to sink my dime?” Jude Stewart in, “A Good Run for Your Money,” decided to find out. Using three criteria: User Experience, Trust, and Effectiveness, she evaluates six microlenders. And winner is…. Kiva (narrowly)!

You can read about my experience with Kiva at “Dr. Yunus, ‘Banker to the Poor’.”

Dr. Yunus, “Banker to the Poor”

Tuesday, March 6th, 2007

I’ve just finished Dr. Muhammad Yunus’s book, “Banker to the Poor.” For those who don’t know Dr. Yunus, he is an economist who founded the Grameen Bank, which pioneered micro-credit lending programs for Bangladesh poor, especially women. For his work with Grameen Bank he won the 2006 Nobel Peace Prize.

The over 270 pages is broken into 14 very readable chapters. The first couple deal with Dr. Yunus’s childhood through his college years in America on a Fulbright scholarship. But the majority of the book deals directly with his awaking to the plight of what he calls the hard-core or absolute poor, his initial attempt to help (lending $27.00 of his own money to 42 people), his first regional project which eventually led to the founding of the Grameen Bank.

It seems like a simple solution that Dr. Yunus hit upon, but there have been and continue to be many structural obstacles. He writes, “In both rich and poor countries alike, credit institutions have favored the rich and in so doing have pronounced a death sentence on the poor. Why have economists remained silent while banks rejected the poor as unworthy of credit? Nobody can provide a convincing answer. Because of this silence and indifference, banks have imposed a financial apartheid and gotten away with it. If economists would only recognize the powerful socioeconomic implications of credit, they might recognize the need to promote credit as a human right.”

I really think micro-lending is a powerful tool for good and justice and Dr. Yunus’s story and work is worth leading about. In reading this book you will learn some important insights and gain a unique perspective on the poor and their willingness to work.

Kiva Update

To put feet to my belief, I joined Kiva (Kiva.org) last fall and started funding micro-loans through their network. Since I can’t afford to put a large amount into loans up front, I’ve been funding a small amount each month. I just did my March funding and now have loans to 11 individuals. Eight have started repayments and two are over 50% paid off.

I’m curious to hear from others who know about or participate a micro-lending scheme.

  • What has been your experience?
  • Who do you work through to make or fund loans?
  • Any downsides or cautions others should know about?