Kiva.org

As you might have noticed, I added a banner ad to the sidebar a while ago, advertising kiva.org. I had different ads up at different times, hoping to make a tiny amount of money from my blog — but even at the best of times, that didn’t amount to anything worth mentioning. So one day I figured I should use the space I have for something more worthwhile.

I’ve been a member of kiva.org for quite a while, but haven’t advertised it to anyone so far. While I personally don’t mind if people send me invitation mails to charities or petitions they would like me to sign, I’m always a bit reluctant to send others the same sort of thing.

But really, with kiva.org, things are a bit different… you’re not asked to donate anything — or at least not much, and the donation is optional. So maybe some of my readers will be interested in how it works…

In essence, kiva.org is an aggregator for microfunding organizations in less developed/wealthy countries. There are usually a number of organizations in those countries offering microfunds, but it’s sometimes hard for them to acquire the money that their clients would like to borrow.

Enter kiva.org — the website not only collects money for microfund organizations, but does so for field partners around the world.

Kiva.org has seen a lot of usage. A lot. Right now, when you want to lend money, you won’t be able to — there just aren’t enough clients applying for credit. The lending page on kiva.org just shows some statistics of the impact the site has. Here are some excerpts from this week:

  • 12,109 lenders made a loan.
  • 1 loan was made every 26 seconds.
  • 14,016 new lenders joined.
  • 16,962 gift certificates purchased.
  • 2,778 entrepreneurs funded.
  • $960,325.00 lent.1

Overall, kiva.org managed to lend $54,458,460 to enterpreneurs around the world.

Most charities don’t reach a million dollars in donations over the course of a year. Some of the bigger may, but google for charities yearly reports, and you’ll find few this effective. The impact of this website is very real.

Now technically, kiva.org isn’t a charity. You don’t donate anything, really — granted, the microfund organizations don’t disburse the full amount of the loan2. But it’s not like regular charities in that you do get repaid the money you lend.

Maybe that’s the attraction the website offers. You’re spreading your wealth, but you’re not really losing anything at the same time. It’s certainly the reason I’m a lot more generous with my money on kiva.org than I’m elsewhere.

I’ve discussed how kiva.org works with other people, and there are arguments why you would not give money here. The best of those is that you’re funding enterpreneurs, who by their society’s definition are likely to be moderately wealthy already. You’re not helping people who have so little that even clean water is difficult to get by.

And that’s a fair criticism, to which I have no counter-argument.

On the other hand, what kiva.org does is a classic example of helping people help themselves. The idea is to encourage the growth of wealth within the country, and therfore indirectly improve living conditions for everyone over time.

“When everybody else is better off, they can buy more, they strengthen demand, strengthen the market, strengthen the country.”

Carlos Slim Helú, second richest man in the world, makes a point of supporting this sort of charity over the traditional one.

“Our concept is more to accomplish and solve things, rather than giving, that is, not going around like Santa Claus. Poverty isn’t solved with donations.”

Both have their place. With kiva.org, the investment-style charity becomes something everyone can easily participate in. So why not give it a try? You’ve got nothing to lose, after all.

  1. Yesterday it said over a million. I assume they measure things in 7-day-periods. []
  2. Or they keep a percentage of the loan to cover their operating costs in other ways. Also, you can donate some money to kiva.org to cover their operating costs. []