A Gift that Literally Keeps on Giving

We had a hard time thinking of what kind of gifts to give to some of our wedding party and to our parents, and then I remembered an episode of Frontline World that I saw on PBS a few months back that featured a non-profit microlending organization called Kiva.   Then it struck me, what a perfect gift idea!

What is microlending, you ask? Well, it’s a system in which you give a small loan directly to a poor person in a developing country who is trying to start their own business, or improve an existing small business.  The idea is that these loans will help the borrowers improve their lives and will help them to break the cycle of poverty.  I would think it also helps the economy of their community because as small businesses grow they will need to purchase raw materials, etc. from other nearby businesses and often they will begin to employ other people in their village/town/city.  

Also, the borrowers almost always pay back these loans in full and on time.  My guess is that this is because of the direct relationship between the lender and the borrower, rather than the impersonal relationship one would have with a bank or financial institution.   So far, Kiva has a 100% repayment rate.  That’s pretty impressive!

Kiva works like this:

1. You go to their website (www.kiva.org) and you look through the profiles of entrepreneurs that need loans. 
2. Choose a borrower to lend to and make a loan using a credit or debit card via Paypal.  The minimum loan amount is just $25.
3. After the borrower raises enough money, they will receive their loan and you will periodically receive updates from Kiva on how their business is going. 
4. After the loan is repaid by the borrower, you can choose to withdraw your money and get it back, or you can re-lend it to someone else.

So far, I’ve given out two loans.  One to a family in Cambodia that own a general store to get more inventory, and one to a man in Bolivia who has a print shop and wants to get some better equipment.  It’s kind of fun to look at the different profiles of the lenders and pick one that you would like to help (although if you’re a bleeding heart like me you’ll want to help them all!) and then see how they do once they get their loan. 

I would’ve loved to do this for our wedding favors, but since the minimum loan amount is $25 that wasn’t possible for us.   So we gave $25 Kiva gift certificates out to some of our wedding party and $100 gift certificates to each set of our parents.    They look like this:

I think it’s a better gift idea than just a charitable donation in someone’s name, because the person you give it to still gets to do something with it.  Instead of just getting a certificate saying that you made a donation to whatever charity, they actually get to go and pick who they want it to go to, and they get to be involved in the process.  It’s very interactive and I think it’s kind of fun. 

The people we gave these gift certificates to seemed to think it was an awesome idea and I’ll have to follow up with them sometime to find out who they lent it to.  I think we will also be using these for Christmas gifts for some of those people who don’t want/need anything and are just impossible to find gifts for.

Watch the video from PBS Frontline World below to learn more about Kiva and microlending

Or go here for one from the New York Times: http://video.on.nytimes.com/?fr_story=FEEDROOM186917

So, has anyone else out there given the gift of Kiva or something similar?  Does anyone think they might?