I haven't mentioned Kiva in a really long time. So, just for a quick reminder, Kiva is a micro-lending organization... or more like a middleman... in helping folks like us provide loans to people all around the world. While it is a non-profit, the money you "lend" is not tax-deductible since it is ultimately paid back to you -- and then, if you choose, you can use those same funds to lend to a new person. (FYI, direct - non-loan - donations to Kiva are tax-deductible)
Recently Kiva changed the way it returns the money back to you. It used to be that you only received the funds when the loan was fully repaid. This threw some people in a tizzy... which I didn't really think was in the whole "spirit of giving"... heck, I was just happy to be helping someone out and that I was getting the money back eventually... I wasn't doing this as investment (some folks wanted interest on their loaned money) or concerned myself if Kiva was getting interest on "my" money... but alas this was an issue to some...so in the last couple of weeks, Kiva now credits your account as each monthly payment comes in.
All these partial loan re-payments have pretty much shut-down the Kiva site... much like when the organization was mentioned on The Today Show... or Bill Clinton in his book... or the biggie of 'em all... Oprah... all the loans have been scooped up.
When I first joined Kiva in June 2007, I made what I dubbed for a very long time a rookie "mistake." The minimum contribution to a loan is $25, but at the beginning I tended to give a bit more than that since I wanted to help out more. Well, it took only a couple of days to realize that the loans were always filled... and that it was actually more "fun" when you a large group of people from all around the world pulled together to help out this one person.
However, I decided to take on a loan all by myself... and at several hundred dollars. It's not like I couldn't afford it... but afterward, I realized I had tied up all that money for 18 months (the term of the loan) - when I could have "spread the wealth" and contributed $25 to dozen+ other people. To make matters worse, it took a very long time for the first loan re-payment to show up and it went into "delinquency"... and I feared the money would truly be lost if it defaulted (again, not that it really mattered... as my intention was just to "recycle" the funds to others).
However, 6 months later the first payment showed up... and there has not been a missed monthly payment since... and now with Kiva's new credit/return policy all those interim money is back in my account... but given that it was one of my first loans and my initial worries about the non-payments, it is a quite special one to me... so I was thrilled this week when I received this field update about the loan (and a picture!):
I am writing with an update on the loan you made to Victorine. My name is Yuan – I’m from the UK - and I am privileged to be the Kiva Fellow working with microfinance NGO GHAPE based in the country’s North West Province.
Victorine is now in her third year as a GHAPE borrower. Her first loan was used to buy more supplies for her business cooking and selling food at the local market. She used the profits and the money GHAPE encouraged her to save, to pay her children’s school fees. After successfully repaying her second loan, Victorine borrowed money on the loan you made for her business. She says things are going well – she is ahead with her repayments - and the loan has been a “wonderful” help. Before joining GHAPE she and her husband had just built their house which was totally empty, so she is very pleased that they have been able to furnish it.
Victorine says she cannot even explain how much the loans have improved her life, though she also complains about having to occasionally cover for other borrowers who cannot meet their repayments.
If only all of life's "mistakes" could end up like this one!
Wow! What a touching letter.
Thanks for reminding me about Kiva. And all this time I just thought it was the street I grew up on in Mesa!
Posted by: kenneth | Saturday, September 13, 2008 at 01:25 AM