As an avid supporter of Kiva, I was very happy to watch the BBC World News‘ program titled ‘Alvin’s Guide To Good Business’: Alvin Hall, a business and financial expert, is travelling the world helping social entrepreneurs become more successful. Can the poor borrow their way out of poverty? Alvin aims to find out by lending just $25 to two small business women in Tanzania, via Kiva, a global micro-finance website. Can Alvin help Kiva achieve its ambitious goal of reducing global poverty by linking lenders directly to small entrepreneurs, using the power of the internet?
When you help others,
– - From the Broadway musical ‘Avenue Q’
In the past year I have loaned $25 to a woman from Pakistan so that she can expand her dry cleaning business, $25 to a woman from Peru to start a clothing business, and $25 to a woman from Tajikistan who wanted to increase the range of goods she sells in the local market. You see, I used to donate money to worthy causes, but after reading too many reports about managers using donations for their own lavish existence, I have grown quite cynical and gradually stopped donating money. Micro-financing is different, as you do not donate your money but lend it for a period of time to an entrepreneur in a developing country, and you get your money back after a couple of months. This helps a great deal as those entrepreneurs do not need to use loan sharks. Kiva.org is the world’s first person to person microlending website. The $25 from me joined others’ and the total amount of money loaned and repaid to this date is 31 million dollars with a default rate of 1.8%. Yes, that’s right, 98% of the money was paid back, allowing the microlenders to take it back, or lend it to someone else.
NBC Correspondent John Larson traveled to Africa to visit the Kiva Entrepreneurs he has loaned to: