DIY Foreign Aid

Bryhanna Greenough clicks into the world of microcredit.

The main page of kiva.org is full of photos of people from all over the world.

Each accompanying bio outlines age, nationality, family status, and aspirations. A few clicks of the mouse and a credit card are all it takes for a guy in St. John’s to pair up with a dressmaker in the Ukraine, for example.

But I’m leading you a bit astray here…

This website spreads love, but it’s not the romantic sort.

Kiva is a non-profit organization that lets you lend money to small businesses run by low-income entrepreneurs around the world. The goal is to reduce global poverty by creating a streamlined system which allows people with a little bit of money to connect easily with people who are trying to start or maintain their own small businesses. 

And what’s particularly interesting and exciting is, the money contributed isn’t a charitable donation. These are real loans—from 25 bucks on up. No interest is charged, and the loan term typically runs between six and twelve months. You can choose exactly where your money goes and follow the person’s progress online.

The last time I looked, applicants ranged from a Mexican welder to a 42-year-old mother of three in Cambodia who runs a small grocery out of her home.

The following is a bio of a farmer living in Togo. He is pictured on one knee holding what looks like a root above a freshly dug hole.

Komi Tengue, 47, has two wives, eight children, and is the guardian of two other children who are orphans. He works primarily as a farmer but in a location where problems of terrain present themselves harshly. Lacking arable land, he is obliged to lease land for his crops, meaning that it is very costly for him. To address this situation and to better serve his customer base, he is requesting a loan of $1,000. He will then be able to acquire cassava stems for planting and also to buy land for cultivation. Once his plans are realized, his living conditions will change.

Kiva.org is full of stories like this, giving people a boost towards self-sufficiency.

It’s guaranteed a dollar from your piggy bank goes a lot further in sub-Saharan Africa than it does here.

Admirably, Kiva doesn’t discriminate between the sexes. By making loans available to women as well as men Kiva gives everyone the opportunity to elevate their social status.

As most of us know, typical bank loans can get pretty expensive—but Kiva collects no interest. Microfinancing institutions in developing countries then act as go-betweens, approving loans and distributing and collecting the money on behalf of Kiva. Those organizations do charge the recipient some interest, but they make sure to partner with institutions that charge fair rates. Kiva tries to be as transparent as possible by posting stats about each microfinance institution.

It’s also possible to see what percentage of money has been raised, and in the case of those who’ve received all of their funding, you can see how much of their loan has been repaid.

So far there have been more than 50,000 internet lenders, and more than $5 million has been lent. Kiva boasts a +99% on-time repayment rate since its creation last year.

I first heard about Kiva from Dave Hopley, owner of Living Planet, What’s Upstairs, and co-owner of Johnny Ruth.

The first time he heard about it on television, he went online to check it out for himself, and ended up lending a couple hundred bucks to a cabinetmaker in Equador, and a Ukrainian dressmaker who needed her own sewing machine…

That was about nine months ago.

“Every month or two now I get an e-mail saying one of my lendees has paid back x amount of dollars,” says Dave. “But you can’t withdraw the money until the complete loan has been paid back.

“That hasn’t happened yet, but I’m close to it with a couple of people.”

He says when a loan is paid off completely, it comes back into the Kiva account and the lender can either withdraw it or reloan it to someone else.

“I think it’s a good way to directly help an individual person and in my case I’m in business,” he says. “The bank has lent me money to get my business going, so I don’t see any reason why these people shouldn’t be qualified to have someone lend them money.”

“It’s easy to do,” he says. “It’s a few clicks of a mouse. That’s all.”