Although I had heard of the microfinance non-proft Kiva a while back, the idea of providing small business loans to help rural and poor entrepreneurs around the world truly dawned on me after reading Chris Guillebeau’s Art of Non-Conformity. With Thanksgiving tomorrow, this sounded like an amazing opportunity to start giving a little of what I had to many people and to make a big impact on their lives. I know it’s a bit cliched, but you know, pay it forward.
I took $25 of some recent gig proceeds from my Brazilian bands and invested it in a microloan. This is the minimum amount Kiva offers for loans. I think one of the best aspects of Kiva’s system is the “revolving” nature of funds that get loaned out. I’m familiar with revolving funds from working in the municipal wastewater sector. Just as cities borrow money to upgrade aging infrastructure and repay that debt over time, my $25 Kiva loan can theoretically be invested, used, and repaid to be handed to another enterprising business person.
And given the responses of many friends, online forums, and Kiva’s stats, the repayment rate is close to 99%. That really made me feel good about the hopefully permanent nature of my investment.
The first loan I made was to a women’s cooperative bank in Paraguay to support a retail clothing business.
I’ve only been to Paraguay unofficially and probably for all of about 30 minutes, thanks to a tour of the Itaipu Dam that straddles that country and Brazil. It is one of the poorest countries in South America, with an average annual per capita income of US$4,555.
I’m excited to follow the progress of this simple yet powerful act and watch it unfold. And I’ll be posting updates to the blog on my first Kiva loan as they become available.
I’d like to know if you’ve given to Kiva or other similar microfinance organizations before. What first motivated you? What has your experience been?
Please leave a comment or send me a message on Twitter.