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kiva micro finance loans
October 2008 
Kiva - is it working? is it worth it?
Posted on Oct 28th, 2007
by 
Sam
Sam
I have been a KIVA member almost since inception (http://kiva.org).
Initially I thought the loans are interest free for the recipient and only found out later that this is absolutely not the case. Kiva itself does not charge but the local micro-lenders that cooperate with kiva do - and heftily so (in the 15-30% range).
So I kind of lost much of the enthusiasmn of the first days. The re-payment ratio is excellent (so far my 1200 bucks from 15 loans I made are repaid in full and on time). I am pretty sure big monetary institutions will jump on the bandwagon soon with that low a risk.
I think in the future I would only support interest free lending - but of course thats a different ballgame altogether. Maybe with additional 10% of the loan as donation towards payments for handling the loan locally that could be achieved.
Initially I thought the loans are interest free for the recipient and only found out later that this is absolutely not the case. Kiva itself does not charge but the local micro-lenders that cooperate with kiva do - and heftily so (in the 15-30% range).
So I kind of lost much of the enthusiasmn of the first days. The re-payment ratio is excellent (so far my 1200 bucks from 15 loans I made are repaid in full and on time). I am pretty sure big monetary institutions will jump on the bandwagon soon with that low a risk.
I think in the future I would only support interest free lending - but of course thats a different ballgame altogether. Maybe with additional 10% of the loan as donation towards payments for handling the loan locally that could be achieved.
Access: PublicTagged with: kiva micro finance loans
Hi Sam, fellow Kiva lender here =)
I totally feel your desire to facilitate no-interest loans and hope this becomes a feasible possible in the future; your idea of adding on an addional 10% to the donation ammount (or at least providing this as a choice at checkout) is a great one!
From what I've been learning during my research of microlending (there's a great documentary called Small Fortunes) the 15-30% interest charged by local micro-lenders associated with Kiva is often MUCH lower than other options available to loan recipients- if other options even exists.
Happy lending, Xander
Given the mindset of todays society and the fact that the guys distributing the cash and collecting the debth need to live too a percentage on top of the loan looks necessary. if 10% are not enough (what I would donate on top of my loan) another 10% could come from the loan receiver - but not more. that is how much I pay if o overdraw my checkings-account and I consider it hefty. I pay about 7% on a regular loan. If 20% are not enough to feed those guys maybe they need to re-organize the way they do business. After all, to take more from those who have less isn't what I had in mind. “What is robbing a bank compared to running and owning one” as Brecht stated. The Rothschilds., Morgans and Rockefellas are ruining our planet - I dont want to have more share in their doing than absolutely necessary.