Kiva.org: So sucessful it has run out of projects to fund
nytimes.com
nytimes.com
I don't understand why a paraguayan store owner would need $1075 to stock her store (http://www.kiva.org/app.php?page=businesses&action=about...), but it certainly seems like these kinds of investments are kick-starting entrepreneurial activity in places where it was traditionally impossible or exceedingly difficult.
I think Kiva is my favorite new business because it truly does raise the social welfare of the world while also being a startup.
I read bout Kiva, Ashoka, and the Grameen bank a few years back (which was the basis for micro-loans and its inventor won a nobel prize).
An excellent read to show how innovative minds (read: startups) are changing the world
I wish more ngos would be run with this kind of startup mentality!
Stunning.
Compare that to the ho-hum attitude many Americans have toward credit responsibility.
I'd ask what's happened to our country, but I'm afraid you guys might actually answer.
So these third world countries are so successful because their businesses don't take any risks?
I think most people would... It has nothing to do with being american, it's the conditions these people are living in that make them appreciate the help.
If someone really helps you get ahead then it's likely you will want to repay them and I think that's what you can see happening at kiva. It's not a big home loan or a credit card... it's a chance to really help improve their lives.
You should man up and repost the comment you made and then deleted...
The only ho-hum loans that I've seen people take out is 100k to 150k school loans for useless schools.
All of this anti-credit for Americans stuff makes me laugh. This is because, relative to other countries, I think the high availability of credit and investment capitol is the strongest economic asset the US has.
So, when all of a sudden, out of nowhere, some company comes along and says to all of these people, "Hey everyone, we'll loan you the money you need to start a business so you can live", the people are offered an opportunity to change their lives to such an extreme degree that they're willing to do whatever it takes to get the money and pay it back. Here, in the Western world, if you start a business, fail, and lose half a million dollars, you can brush it off and try again with a different idea and investor. Granted, it might take you a while to find someone else who is willing to put the capital up, but you can. Over there, they can't. They have only one shot, so they take it and do the absolute best they can because it is an opportunity that will only come once.
With that in mind, nearly every loan in the Western world can be taken with a ho-hum attitude becuase the opportunity will present itself again. That just isn't the case for those people.
Second, they write status reports back to the site, so they know they are not being "used" by some "big company" - they know there are humans on the other side of the computer.
Kiva screens and follows-up with the borrowers, something which was noticeably absent in the mortgage loan market:
William D. Dallas, the founder and chief executive of Ownit, acknowledges loosening lending standards but says he did so reluctantly and under pressure from his investors, particularly Merrill Lynch, which wanted more loans to package into lucrative securities.
He recalls being asked to make more "stated income" loans, in which lenders do not verify the information provided by borrowers and brokers with tax returns, pay stubs or other documentation. The message, he said, was simple: You are leaving money on the table aEUR" do more of them.
http://www.nytimes.com/2007/05/08/business/08lend.html
If Kiva ever turns into a similar free-for-all, then expect their default rate to rise, too.