[Update Feb 4, 2009: I’ve created a GovLoop group and kiva lending team.]
Have you heard of the microfinancing concept? The basic idea is that by making very small loans to entrepeneurs in developing areas, you help them help themselves and contribute to the local economy.
Thanks to Craig Newmark, founder of craigslist,com, I learned about kiva.org, a site that lets you choose who to lend money to. They also have a lot of information about the risks involved, and they give you quite a bit of reporting about the “field partners” who actually find the borrowers and handle the transaction.
I decided to lend $25 to a group of Pakistani women. They’re supporting each other, so if one business has trouble, the others repay its share of the loan. The total funding request is only $1400, and they need only another $225 (update: not anymore – Craig completed it).
Here’s the full description:
My name is Sakina and I’m 33 years old. I have been a citizen of Borewala, Pakistan for the past 12 years. I couldn’t get my education because my parents could not pay for the educational expenses. I am married to Shoqat Ali, who sells Punjabi food. He sells samosas (a pastry filled with potatoes, onions, and peas) and pakodas (a fried snack made from onions, chili, and coriander) and people used to come to him to buy these items. He has a good reputation among people. I help my husband to prepare these items. My husband is very happy with me. I am applying for a loan to buy cooking oil, spices and flour to expand my husband’s Punjabi food business. I’m the leader of a group of women in my locality. Shamim baji wants a loan to buy an auto-rickshaw (a local three-wheeled motor vehicle). Parveen baji wants a loan to buy masonry tools. Shamim Kosar baji wants a loan to buy cloth, thread and sketches for her carpet-weaving business. Anwar baji wants a loan to buy a donkey cart for loading. Tahira Parveen baji wants a loan to buy a donkey cart for loading.
One thing I hugely respect is that the founders don’t take a cut. They do ask you to donate on a separate page once you choose how much to lend, but it’s still up to you. I decided to add another 10% to my $25 loan, as they suggested.
There are “teams” of lenders, too. I wonder whether we could get something going from govloop. I mean, we’re all dedicated to public service or we wouldn’t be here, right? So maybe we could organize something. For example, if 9 of you jump into the loan linked above with $25, we’ve got it covered.
Whatcha think?
Ah, seemed to be a good idea to complete the loan…
Yea verily, thou dost rockest most righteously, Craig!
So who wants to put together a GovLoop loan team?
Jeffrey, you need no publicist. You straight up rock.
We just need a forum post and for you to put forth a worthy entrepreneur to get this rolling.
Another cool microloan place is microplace.com. I tried out a loan to Tanzanian women several months ago and it seems very cool. I like the way the website gives all sorts of feedback on that status of your loans and other statistics. I must confess I’m not totally clear on their overhead and that sort of stuff…it did seem reasonable when I checked it out a few months ago….the main point is the whole concept of microloans is definitely a big win concept!
I’m game. I’ll throw together a forum post and see if we can get 9 in. I’ll send over my $25 as we speak.
Oops.
I see the loan is completed (Thanks Craig). But I’m game if we want to do a monthly kiva.org project on GovLoop and I’ll post the link and promote it and see if we can fund it.
As we move to February if someone (Jeff?) wants to pick a project on kiva.org, I’ll try to prominently promote it on the site and newsletter. I like the idea of doing one per month – it’s a great idea.
Very true about the macro effects. You can make a huge difference with something less than the price of a 1 course meal at an inner city restaurant. A great idea!
Steve: do you want to set up the kiva team?
I’d be happy to, but didn’t want to step on your toes.
I’m also happy to pick the Feb. project.
I’d be happy to be part of the team. I’ll be watching for the Feb project.
I have a friend who is interested in the topic of microlending. I wanted to send him a link to this post without having to confuse him with the group “invite” process. Is that possible with this group or is this one of the features of a “walled garden” network?
[Update Feb 4, 2009: I’ve created a GovLoop group.]
Did anything come of the GovLoop microfunding group? I’d like to be involved.
Oops… I found the kiva group, disregard my last post.