How many times have you lent money to someone in the developed world and never had it repaid? Or worse still, had it repaid begrudgingly? About 2 years ago I came across a website called www.kiva.org and was immediately taken with the idea. Rather than raise money for charity, these guys actually lend your money to entrepreneurs in developing countries (interest free and fee free) and then collect the repayments which you can then keep or re-lend. It is akin to teaching people how to fish rather than buying them a fish and it works incredibly well.
I started by making three $25 loans ($25 is the maximum to you can lend to any one entrepreneur) and my $25 was grouped with other lenders from all over the world. Contrary to western thinking where the richer you are the lower the credit risk, these poor people all re-paid my loan on time and in full and they even reported to me and the others in my lending group in respect to how their business was going. I was blown away. I have since relent that original $75 over and over and today we have lent money to more than 40 entrepreneurs with not a single default. This is what I call sustainable charity and is at the heart of ‘good’ capitalism.
If you are looking for something great to do this Christmas, check out Kiva.org or click on the banner below. I have actually asked my friends and family to make a loan as my Christmas present this year. They pass 100% of your money along to the entrepreneur and pay their bills solely on donations you elect to make over and above any money you lend. PayPal have also come to the party and waived all fees related to Kiva transactions.
