A few years ago I happened upon Kiva, an organization that makes small loans to low-income individuals around the world. It’s a teach-a-man-to-fish sort of thing, instead of just giving money to these people, with the goal of both aiding their livelihood and the economy around them. It’s an involved process, so here’s the short version.
The long explanation can be found here.
Since I joined, I have made loans to a group of women in Ghana so they could buy supplies to make and sell clothing, a man in Kenya to buy products for his store and another man in Kenya who owns a butcher shop (his loan was for 3 bulls). Of all the loans I have made, only one ended in a loss. Yes, a loss (of maybe a penny). Losses happen (usually due to exchange rates changing), but as far as I can tell they are very small. When you make a loan they tell you a ton of information about the lending institution and the percent of loans at risk.
Now I didn’t fund all of my loans in full. Each loan is funded by a random group of people, whoever chose to donate to that particular need. I merely donated $25 here and there. I’ve been using the same $50 to fund about 3-4 loans/year. Once each loan is repaid, I donate the money again. It’s a happy circle of self-perpetuating microfinancing.
I really enjoy the site, and it’s very easy to use. They have an awesome loan sorting system. You can sort loans by country, type of need, how much time is left for their loan to be funded, male/female and so forth. It’s up to you where you want your money to go.
Right now Kiva is providing (through an anonymous sponsor) free $25 trials, which is why I have gathered you here today. There are a limited number of these free trials, so they might be all gone already. No matter, you can still join the site for free and take a look around if you wish.
Now full disclosure, the free $25 can only be used to make one loan. This money won’t be paid back to you. However, whatever money you add will be paid back to you.
I’m not trying to pressure anyone into the site, I just want to share the knowledge as I think it’s a great system. I don’t get anything for referrals or whatnot, but if you’re interested in it, now is a good time to join. 🙂