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Dean Pomerleau

Helping People via Kiva.org Microloans

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Hey CR folks,

 

If you're in a giving mood this holiday season, I heartily endorse the organization Kiva.org, which allows you to participate in microloans to deserving people around the developing world for only $25. The best part is that once people use the money for their project, they repay the loan so you can lend out the money again. Here is one such Kiva success story, a Peruvian coffee farmer named Avelino (pictured below) who received a $325 loan last year to buy compost and fertilizer so he could increase his crop yield. He was successful and paid back his 10 lenders in full.

 

In the nine years I've been making loans through Kiva, the vast majority (~98.5%) have paid back in full. As a result, I've been able to "roll over" (i.e. re-lend) the amount I initially dedicated to Kiva loans a total of 14 times. In other words, for each $25 I devoted to Kiva loans, I've been able to lend $350 over the years, thereby helping a lot of people. The money you give via Kiva.org isn't tax deductible, since its a loan. Nor do you get interest on the loan. But once it is paid back, you can withdraw the money rather than re-loan it if you want, so it is still yours. But as I said, I appreciate the opportunity to roll over the proceeds from repaid loans, and help new people with the money.

 

I tend to focus my loans to people like Avelino, farmers or people who sell fruits & vegetables, and who commit to repaying the loan relatively quickly (usually under 1 year), so I can re-loan the money to others as quickly as possible and help the most people. But that's just one strategy. Kiva provides a ton of different ways to search for loans that meet your own criteria.

 

Anyway, I believe in Kiva so much, I'm giving away a $25 loan gift code to encourage the first person who reads this and wants to give Kiva a try.

 

Simply go to kiva.org/redeem and enter this gift code: RAUH-RK3N-QXKD-KDXP

 

Start loaning through Kiva.org today. You'll be glad you did!

 

--Dean

 

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If you're in a giving mood this holiday season, I heartily endorse the organization Kiva.org, which allows you to participate in microloans to deserving people around the developing world for only $25. The best part is that once people use the money for their project, they repay the loan so you can lend out the money again. Here is one such Kiva success story, a Peruvian coffee farmer named Avelino (pictured below) who received a $325 loan last year to buy compost and fertilizer so he could increase his crop yield. He was successful and paid back his 10 lenders in full.

 

Dean,

 

This was a great post!

 

Thank you for bringing Kiva.org to our attention.

 

I had been wondering about how to extend microcredit, and kiva.org appears to be a great way to accomplish that.

 

I read up about the organization at Wikipedia: Kiva.org and at reddit: Kiva.org.

 

Despite my considerable reluctance in registering accounts online (fearing well-meaning organizations being hacked), I created an account.

 

For others reading this, rest assured the website is easy to use and permits payments via PayPal. It was all very painless, including "choosing a borrower" (to use kiva.org's phrase).

 

Dean wrote:

I tend to focus my loans to people like Avelino, farmers or people who sell fruits & vegetables, and who commit to repaying the loan relatively quickly (usually under 1 year), so I can re-loan the money to others as quickly as possible and help the most people. But that's just one strategy. Kiva provides a ton of different ways to search for loans that meet your own criteria.

 

There were many appealing borrowers.

 

For starters, I've been looking for coffee farmers in South America. I favor older folks, since there is a log of ageism in the world, making it hard for elders to catch a break.

 

Dean wrote:

Anyway, I believe in Kiva so much, I'm giving away a $25 loan gift code to encourage the first person who reads this and wants to give Kiva a try.

 

Simply go to kiva.org/redeem and enter this gift code: RAUH-RK3N-QXKD-KDXP

 

Thank you! I used your gift code and added my own portion for a "Total Loans, Gifts, and Donations $57.50".

 

There was an anonymous donor who matched my contribution, which sweetens the deal.

 

For others, note that every $25 to a borrower incurs a $3.75 contribution to kiva.org, including the $25 from Dean's gift card. However, the $7.50 that goes to kiva.org from the $57.50 is not outrageous.

 

Dean wrote:

Start loaning through Kiva.org today. You'll be glad you did!

 

Yes Dean, I am glad to join Kiva.org and help out people like Gregorio.

 

Thanks again for the gift card and the introduction to a fine microfinance organization.

Edited by Greg Scott

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Greg,

 

I'm so happy someone decided to give microlending to deserving people in the developing world a try via Kiva.org, and especially you, since I know it took a lot for you to overcome your natural reluctance to sign up for on-line accounts, I expect especially when money is involved. So thanks for giving it a try. I'm sure you won't regret it.

 

One clarification. You said:

 

For others, note that every $25 to a borrower incurs a $3.75 contribution to kiva.org, including the $25 from Dean's gift card. However, the $7.50 that goes to kiva.org from the $57.50 is not outrageous.

 

The $3.75 contribution to Kiva.org for every $25 loan is just a recommendation, to help Kiva to provide the service. I don't always make such a contribution, but I do fairly frequently.

 

One other thing for you and others to be aware of, in case you haven't come across it already. The money you donate to a particular individual or group on Kiva.org often doesn't go directly to that individual, and in this way some consider the site (and the service) to be a bit misleading.

 

Typically when you make a contribution to loan for an individual or group, that individual/group has already received the money for their loan from the "field partner" (i.e. Kiva administrative partner in the country where the loan is happening). The money you donate is used "backfill" (Kiva's term) a loan - meaning it goes to the field partner to repay them for the money they've already disbursed for the loan. Then, as the loan gets repaid, the proceeds go to you, and not the Field Partner. In a sense, you're "buying out" the loan from the Field Partner, much the way one's home mortgage may change hands once the loan has been made to you, if the original holder of your mortgage (i.e. the bank) decides to sell it to someone else (typically another bank).

 

Here are the two most relevant Kiva.org FAQ pages for how the loan process works via its Field Partners. Everyone interesting in loaning through Kiva should probably read it to make sure they know how it works, the risks involved, etc.

 

--Dean

 

 

--Dean

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