Tuesday, 3 August 2010

Kiva: costs nothing, feels good

I've been meaning to blog about Kiva for ages. This is a website that allows you to repeatedly loan the same $25 (yes, it's all done in American currency, but don't let that put you off) over and over again to small businesses in the developing world.

It really couldn't be simpler - you credit your account with the $25 (and given that the pound is at a six-month high against the dollar, this only equates to about £16), then browse through the ad's to find a small business somewhere in the world that's struggling to get going. You lend them your $25. Note that this may form part of a larger fundraising target for the business, and they won't start paying you back until all the money has been raised. But as and when they get up and running, they do pay you back... and when your account balance is back up to $25 you can lend it out again. Brilliant, isn't it?

I suppose technically it doesn't cost absolutely nothing - I could get all economicsy, and say that there is the opportunity cost of not using the money for something else. Or you could put your £16 in the building society and get 16p interest on it in a year... but that would, of course, make you a miserable git. I've been Kiva-ing for just over two years and, in that time, have lent the same $25 to a Samoan farmer, a Ghanaian fruit and veg seller and a Philippino laundry collective. The latter is 95% repaid now, and when the other 5% arrives I'll be lending to someone else.

So, let's recap: a Kiva micro-loan helps someone less privileged than you, is ridiculously easy to do and costs nothing, unless you are an unbelievably miserable git. So go on, why not give Kiva a try? Trust me, it feels good...

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