Tag Archives: poverty

Discovering kiva.org

In all the recent posts I’ve been reading about peer-to-peer lending, including the excellent reporting by Jim Bruene at NetBanker and Colin Henderson at The Bankwatch and CommunityLend, I hadn’t come across Kiva.org.

I’m very excited about social personal finance and think it may well change the way people exchange money when they just need to borrow or invest a small to medium amount and don’t want to bother with a bank or credit union.

But tonight my aunt showed me Kiva.org, and I got to admit I was a little embarrassed to admit that I didn’t know what it was. It’s an amazing concept where anyone can make microloans to people in the developing world who need small amounts of money to start an enterprise. According to their website:

Kiva lets you connect with and loan money to unique small businesses in the developing world. By choosing a business on Kiva.org, you can “sponsor a business” and help the world’s working poor make great strides towards economic independence. Throughout the course of the loan (usually 6-12 months), you can receive email journal updates from the business you’ve sponsored. As loans are repaid, you get your loan money back.

You can cash out when you’re repaid or reinvest it into a new opportunity. I think this is genius. Did everyone else know about this and somehow I’m the last to the party? Hard to be shown up by my aunt after all…

I started tonight by investing $25. Kiva.org asks you for a 10% addition as a donation to keep them running. That’s optional. You can pay by PayPal or credit card. When you’re done you can easily send the info about the cause you donated to to your email list to spread the word. Nicely done.

Here’s who I donated to: Massan Aziado of Togo. Fantastic and inspiring!

A follow up on my America Saves post

I was speaking to some people at Vancity about the issue of serving the underbanked and underserved, both of which are areas where we focus strongly. Two interesting things came back.

1> Someone in our Sustainability division (who shall remain nameless) came back with this nugget:

Money is like sex, you can have a lot of it or none of it and still have an unhealthy relationship to it.

2> Catherine Ludgate in our Community Business Banking division told me this story:

I was at a conference last week with a woman from Micro Business USA, and she was talking about the different mindsets of folks along the income spectrum. In her 30+ years of doing microlending and setting up savings programs, she said she has learned that poor and low income folk generally think of what they earn only in terms of their hourly pay (and certainly not about savings). An income cut above, the lower middle class earners think about their weekly earnings. Middle class earners think in terms of their monthly income, and upper middle class earners think in terms of annual income. The truly wealthy (however that is defined) think ahead in terms of three to five to ten year investments they will make.

Her argument was that changing how folks identified their value (hourly to weekly to monthly to annually to forward looking) is the first step in changing other behaviours, like the ability to save. And that change in thinking can lead to movement out of an income group, as the woman in the case study in the NY Times article moved.

I thought those were two good and valuable insights.

My original post is here.