Microfinance Recipients Update Investors via Blogosphere
As my fiancÚ and I were drifting off to sleep a couple of nights ago, we started talking about giving money to charities. Neither one of us is a big fan of giving impoverished people handouts, because it’s not self-sustaining and doesn’t really help them long-term.
I’ve always understood that the real way to pull people out of poverty was to invest in businesses that stimulate local economies in the third world. I believed that this was the job of major corporations, because what could individuals hope to accomplish by investing only $20,000 or $40,000 in third-world business ventures?
Then I learned about microfinance when I read that eBay founder Pierre Omidyar uses his foundation to give microfinance loans to third-world entrepreneurs in Newsweek. “If I ever have enough money to start a foundation,” I thought, “that’s the kind of work I’ll do.”
Obviously Kiva is really cool because it hooks up third-world entrepreneurs with loans from small investors in wealthy countries. The loans requested are often less than the cost of a plane ticket, and they’re paid back 99% of the time. Finally, average working people in the US can opt to share their tremendous wealth (relative to the rest of the world) in an economically sound way.
One thing that I really like about Kiva is that it allows entrepreneurs to keep their investors updated on what’s going on with their businesses by blogging. The blogs aren’t updated all that often, but they do give a glimpse into how the businesses are faring. A quick RSS subscription and you can keep track of how your investment is changing someone’s life, and helping his community.
This is the business blogosphere at its best.