[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.