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Confused about Kiva...

Meet Rin. She's a is a farmer and entrepreneur from Cambodia. Her profile on Kiva.org indicates that she requires 650$ to purchase fertilizer and to hire help to plant casava. Her profile also indicates that she earns 5USD a day. I've never met Rin, but I like her smile and want to help her.

The thing is, I also noticed that the interest rate on the microloan I'd like to offer her will be 30.04% How long will it take Rin to pay off this debt???? I understand that the cost to provide a small loan in a rural country is quite expensive... but I just don't know if I'm helping or contributing to the problem under those conditions. Have any of you had experience with Kiva? Why are their lending partners "for profit" organizations? I've been going through countless Kiva profiles tonight and I can't help but think that I'd love to be able to just give these people money directly. They are mothers and fathers, working hard to provide a better future for their kids, just like you and me.

I'm not knocking Kiva or the lending partners as I'm sure they all work really hard to make a difference... I just wish we could help people like Rin and not charge them 30% interest on a 650$ loan when they make 5$ a day.

See why I'm confused about Kiva? What are your thoughts?
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Bean Paulson's profile photoBrian Saemann's profile photoYanik Falardeau's profile photoSean Archer's profile photo
15 comments
 
Yeah, I read that +Bean Paulson and I do understand the complexity of the logistics... that being said, have you seen her numbers? 5$ a day. She's buying fertilizer to plant casava. What if she has a bad harvest? What then? How will she be able to repay the $650 loan +30% interest?
 
such is the life of a farmer... she knows the risks involved <3 We have made 14 loans through Kiva so far, all to women making/selling handcrafts :)
 
Sigh... I know you're right +Bean Paulson I think it's really amazing that you've made all those loans. I've decided to give 10% of all my profits to charitable causes and I've been looking at Kiva and other places as well. My research tonight also brought me to the Rotary club. They have a microlending platform as well, but they are non-profit. More research is needed. What was your experience with Kiva? Obviously positive since you funded 14 projects, but I'd love to hear more about it.
 
Great article +Brian Saemann I'm reading through it right now. It's good to see all sides of the coin... Have you made loans through Kiva?
 
Kiva, the organisation itself, does not make any money off of the interest charged. When you make a loan, you have the option of tacking on a donation to Kiva onto your payment (I never do.) The interest you see on each loan is charged by a field partner for operating costs, and Kiva has strict regulations on disclosing that information to lenders and borrowers. If you don't like their rates/whatever - then choose a different field partner to work with.

I have loved Kiva since it's inception. Every time we have one loan paid back, we make another. Annabel and I read through several profiles before selecting the woman we support. We choose women specifically to donate to because in many parts of the world, we are still second class citizens. It is more difficult for a woman to obtain a loan & operate a business, among other things.

For those taking out the loans - having a loan with interest keeps people independent, and gives them a sense of accomplishment - fills them with Pride. It isn't a charity handout, kwim? :)
 
I haven't made any loans through Kiva but I do find the whole concept of micro-lending very fascinating. I have made donations on donors choose and like the direct connection a donor has to the project but those aren't loans.

Keep up your due diligence. Eventually something will click and you will KNOW it is the right for you.
 
Thanks +Bean Paulson I love the Kiva/mircofinancing platform and have wanted to contribute for a while. I'm a little concerned after reading +Brian Saemann 's article though as it suggests that the money we lend doesn't necessarily go to the person we've selected. But I guess that isn't really the point. Lots of food for thought here. Thanks for sharing Brian and Bean. I give lots of time in my community and now that I'll be giving money as well, I want to make sure it's going to those who need it.
 
I saw microlending in action when I was in Haiti. Haven't dealt with Kiva specifically, but I definitely think that the microloan phenomenon is a wonderful thing. It allows some dignity and the family I stayed with would have been much worse off without it.
 
I agree +Sean Archer microlending is very empowering. I guess I'm just a tad concerned about middlemen... although the middleman does have a very important role to play. Did you volunteer in Haiti? What was your experience like?
 
I was actually there visiting my girlfriend at the time, who was doing an Apprenticeship in Shared Living. Basically, she spent six months learning Creole and learning how to be a Haitian, so that she could better work with the people there without so much of the imposing of her American values. The concept is that before you can help, you have to learn some of the realities of the culture, and figure out how you can best be of assistance without forcing your way in. I spent three weeks there and got to visit three different communities and got a microcosm of what she was doing there. Learned a little Creole, and learned a little of what it is to be Haitian. It was my first time being out of the U.S. and a wonderful, sad experience.
 
Sounds like a great program & learning experience +Sean Archer I would imagine that an experience like that would have a profound effect for all people involved. I think many of us want to help, but we don't know where to start and It seems very wise to learn more about the culture before swooping in and imposing our solutions. Thank you for sharing your experience... more food for thought ;-)
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