Kiva is a new web site that let’s you do something pretty amazing: fund an entrepreneur in the third world. I’m not entirely sure how this works yet, but I like what I see so far.
From what I can tell, Kiva has partnered with several small (micro) finance companies around the world that are local to the loan recipients. People needing a loan apply there, which get vetted and forwarded to Kiva. Kiva lets you put money towards the loan amount (as little as $25 regardless of the total load requested) and helps manage the payback process. You also get email notices about how the company you have funded is doing and how the payback is going.
This isn’t something you can make money off of. While the local finance companies charge an interest fee (which must be disclosed to Kiva for them to be a partner), Kiva doesn’t collect and none of the interest is passed on to Kiva users. You do get your original investment back, should the loan recipient pay back the loan (there is a chance they won’t, but all of the loans made through Kiva have been paid back at the time of this entry, according to their web site).
I like the idea of people pooling their relatively limited wealth to help out someone trying to get on their feet somewhere else. I’m not poor by most standards and am wildly rich compared to most of the people in the world, but I still don’t make that much compared to other Americans. But here, I can take a little bit of my wealth and help a fellow out thanks to a good use of technology and some really good thinking from a couple of passionate people.
Does it get better? Probably, but this is pretty damn good.