Comments on: Kiva.org — Lending $25 to Celina in Kenya Just Got Easier

By: Jessica

Jessica — Thu, 05 Apr 2007 17:45:30 +0000

It would be nice if we could have a “forgiveness option” meaning that after the loan is paid off, you could have the option of giving the money back to the person you loaned it to. That way, the person who got the loan would feel like they were working toward something and they may or may not get the money and you could still give charity.

That might be a weird idea but I get some sick pleasure of having people paying stuff off and then being like: “By the way, you can keep the money”

By: Cap

Cap — Wed, 04 Apr 2007 20:30:43 +0000

According to the NPR story, the MFI (microfinance institutions) charge 16% for interest.. but i’m sure there may be lower rates too.

I do get what you’re saying Leo, since other people are using our money to fund people, and we bear the risk while they take the money. But as Dawn said, there are cost associated with extending these loans for those having actual workers, heading out to the fields, filtering borrowers, administer and manage these loans.

You should also look at it from this other perspective, since for many of these people, receiving small loans of these size is significantly difficult (at least at a reasonable rate). They are low income borrowers w/o credit or collateral. To get a loan of these size from say.. the local money lender, it would probably cost them 300% in terms of interest.

Here’s another spin on it, 16% is by no means prime rate, but the current U.S. standard rate is around 13.4%, and these are people with some form of credit. If you have bad credit in the U.S., rates above 20% are the norm. So, 16% for them is a reasonable rate, when looked in that light.

But yeah, I understand what you mean regardless. It’s like bearing a risk to help certain people, and having the middleman profit from you helping. Some of these partners are non-profit too though, I believe.

Misti: Yeah totally forgot too. Didn’t buy the burger myself so didn’t think of that. Hmm. Next time :)

By: Misti

Misti — Wed, 04 Apr 2007 18:38:57 +0000

hey, you ate In-N-Out are you going to give any freebies? ;-)

By: chiuy1003

chiuy1003 — Wed, 04 Apr 2007 14:40:23 +0000

wow thanks for the post, sounds really intriguing

By: baking23

baking23 — Tue, 03 Apr 2007 16:27:52 +0000

I hadn’t heard of this before but it sounds interesting. I’ll have to check it out.

By: Moneymonk

Moneymonk — Tue, 03 Apr 2007 15:42:27 +0000

I prefer Kiva over prosper at least your not loaning money to people that need fake boobs or a new wardrobe. With Kiva, you are actually making a difference. It’s more like charity.

By: ~Dawn

~Dawn — Tue, 03 Apr 2007 04:59:19 +0000

My understand Leo is that the interest is anywhere from 2-5% depending on the group. Also the money they get is used for overhead as they are onsite to provide and take in this money and pay their ‘bank’ workers.
I feel it is justifiable.

By: Leo

Leo — Tue, 03 Apr 2007 04:42:01 +0000

It sounds like a great idea, but what troubles me is this parenthetical note:

“although the microfinancing field partners of Kiva do charge interest to borrowers”

So basically, although we are doing a good thing, the partners are making profits off of our money? Why would we allow our money to be used to capitalize a company so others can make profits? I mean, I know there is ostensibly a good thing going on here, but it still seems like someone’s capitalizing off of the good thing and our money.

I don’t know how I feel about that.

By: hejustlaughs

hejustlaughs — Tue, 03 Apr 2007 03:44:53 +0000

I did this months ago and I actually got paid back. It’s a great feeling to see that the money you donate can keep on working to help others.

By: ~Dawn

~Dawn — Tue, 03 Apr 2007 02:03:49 +0000

I love Kiva, I feel like I am giving money and know that it is going to a good cause. One thing of note, a lot of them update their journels in their own language- you may want to have someone translate it and then post the tranlation in the comments for other english-only readers. That’s what I did at least.