Microfinance Recipients Update Investors via Blogosphere

by Teresa Valdez Klein on July 3, 2006

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.”

But that was before I read about Kiva while reading Dav Yaginuma’s blog.

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.

{ 4 comments… read them below or add one }

1 vaspers the grate 07.03.06 at 9:44 pm

I don’t trust any charity organizations, especially the thoroughly corrupt Red Cross.

You won’t believe in “hand outs” to the poor, as individuals, until you, God forbid, become poor, and see what help you recieve from corporations, government, friends, family: nearly zero.

Break your back like I did, twice, and discover how you’re treated, how impossible it is to get disability coverage, how people hate you because you cannot walk, but have to crawl to the doctor’s office.

Being poor, and disabled, is no fun.

I was there once, a long time ago. So I think you’re better off using intuition and research to find individuals in your own neighborhood, church, club, or city…who need temporary, emergency assistance, and hand it directly to them personally, or anonymously via some messenger.

2 Teresa Valdez Klein 07.06.06 at 9:16 am

Hand-outs on that scale are great. But I’m talking about focusing long-term charitable giving on more sustainable methods of support, particularly in the third-world.

3 Tim 10.11.06 at 10:05 pm

Thanks for your post on microfinance and the blog community. It’s amazing that, in the light of innovation, people with kind hearts WILL find ways of leveraging the technology for a greater cause. Thanks also for mentioning Kiva. It’s a unique way for your readers to get involved in a practical manner. Would you consider extending the shelf life of Kiva’s message by placing a permanent link or small banner on your site (easy to apply code is found at Kiva.org)? And let the blogosphere do the rest!

Tim (volunteer with Kiva.org)

4 Teresa Valdez Klein 10.12.06 at 10:17 am

Hi Tim,
I’ll have to run that one by my boss, but I suspect that the answer is “no,” at least until the conference is over.
I will, however put one up on my personal blog.

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