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Author Topic:   Let's micro Loan
jar
Member (Idle past 393 days)
Posts: 34026
From: Texas!!
Joined: 04-20-2004


Message 1 of 38 (443506)
12-25-2007 12:51 PM


In this season of giving, I hope you will consider joining KIVA.org.
Kiva?
What's that?
KIVA is a clearing house that helps make micro loans to small business all over the world, and when I say small, I mean small.
KIVA uses the internet to connect lenders (often as little as $25.00) and borrowers. These are loans, not gifts, the money you lend gets repaid, and you can then withdraw it or direct it to some other project. You get to pick which project or projects you want to support and follow their progress.
To learn more about how you can help, visit Kiva.org
Is there any risk? Sure. There is always risk but their record of repayment has been exceptional. For information on the risks, look here.
Edited by jar, : add risk overview.
Edited by jar, : fix heading

Immigration has been a problem Since 1607!

Replies to this message:
 Message 7 by Modulous, posted 12-27-2007 6:20 AM jar has replied
 Message 9 by obvious Child, posted 12-31-2007 4:14 AM jar has replied

  
jar
Member (Idle past 393 days)
Posts: 34026
From: Texas!!
Joined: 04-20-2004


Message 2 of 38 (443662)
12-26-2007 10:56 AM


Can any of you help?
Micro-loans are one of our best options for trying to help folk improve their lives. Can any of you good folk help with this?

Immigration has been a problem Since 1607!

Replies to this message:
 Message 3 by CK, posted 12-26-2007 11:34 AM jar has replied

  
CK
Member (Idle past 4127 days)
Posts: 3221
Joined: 07-04-2004


Message 3 of 38 (443671)
12-26-2007 11:34 AM
Reply to: Message 2 by jar
12-26-2007 10:56 AM


Re: Can any of you help?
This is a really excellent way to help small businesspeople do..well a little business. I've just invested in a beauty salon.

This message is a reply to:
 Message 2 by jar, posted 12-26-2007 10:56 AM jar has replied

Replies to this message:
 Message 4 by jar, posted 12-26-2007 11:37 AM CK has not replied

  
jar
Member (Idle past 393 days)
Posts: 34026
From: Texas!!
Joined: 04-20-2004


Message 4 of 38 (443673)
12-26-2007 11:37 AM
Reply to: Message 3 by CK
12-26-2007 11:34 AM


Re: Can any of you help?
Thank you sir.
Now who else can step forward?

Immigration has been a problem Since 1607!

This message is a reply to:
 Message 3 by CK, posted 12-26-2007 11:34 AM CK has not replied

Replies to this message:
 Message 5 by cavediver, posted 12-26-2007 12:14 PM jar has replied

  
cavediver
Member (Idle past 3643 days)
Posts: 4129
From: UK
Joined: 06-16-2005


Message 5 of 38 (443682)
12-26-2007 12:14 PM
Reply to: Message 4 by jar
12-26-2007 11:37 AM


Re: Can any of you help?
This is excellent - will definitely be investing. Always enjoyed playing in the emerging markets

This message is a reply to:
 Message 4 by jar, posted 12-26-2007 11:37 AM jar has replied

Replies to this message:
 Message 6 by jar, posted 12-26-2007 12:17 PM cavediver has not replied

  
jar
Member (Idle past 393 days)
Posts: 34026
From: Texas!!
Joined: 04-20-2004


Message 6 of 38 (443685)
12-26-2007 12:17 PM
Reply to: Message 5 by cavediver
12-26-2007 12:14 PM


Thank you sir
I really appreciate your help. Yup, definitely emerging, so far below the radar that it is often over looked.
Little changes though can have big results.

Immigration has been a problem Since 1607!

This message is a reply to:
 Message 5 by cavediver, posted 12-26-2007 12:14 PM cavediver has not replied

  
Modulous
Member
Posts: 7801
From: Manchester, UK
Joined: 05-01-2005


Message 7 of 38 (443863)
12-27-2007 6:20 AM
Reply to: Message 1 by jar
12-25-2007 12:51 PM


For those that want returns
KIVA doesn't pay returns to lenders for its loans. That isn't a criticism, just a statement of fact. It took me a while of reading to understand how their business compares with bonds. The advantage of Kiva is that you get to see who the borrowers are, and what they'll use the money for and that 'intimacy' can certainly provide emotional impact.
I thought I'd have a look at other similar business models and see if anything else was going on in the microfinancing world. I found Micro Place. The first issue I had with it was that it is an eBay company - but I looked past that and investigated. Instead of giving money to the borrower via field agents, you give money to the micro-financing companies (via securities) who can then loan that money. Example:
Oikocredit:
Borrower repayment rate: 100% Woman borrowers: 100%
Total loan portfolio: $2,415,740 First-time business owners: - -
Number of active borrowers: 12,662 Operational self-sufficiency: 127%
Avg. loan balance / borrower: $259
You get a small interest, in this case it is 1.5%
It is an exercise for the reader as to which method they prefer, and I've no idea if one can be said to be 'better'.

This message is a reply to:
 Message 1 by jar, posted 12-25-2007 12:51 PM jar has replied

Replies to this message:
 Message 8 by jar, posted 12-30-2007 9:43 PM Modulous has not replied

  
jar
Member (Idle past 393 days)
Posts: 34026
From: Texas!!
Joined: 04-20-2004


Message 8 of 38 (444792)
12-30-2007 9:43 PM
Reply to: Message 7 by Modulous
12-27-2007 6:20 AM


Re: For those that want returns
Another great possibility.
Let's see how many micro loans we can make folk.

Immigration has been a problem Since 1607!

This message is a reply to:
 Message 7 by Modulous, posted 12-27-2007 6:20 AM Modulous has not replied

  
obvious Child
Member (Idle past 4115 days)
Posts: 661
Joined: 08-17-2006


Message 9 of 38 (444845)
12-31-2007 4:14 AM
Reply to: Message 1 by jar
12-25-2007 12:51 PM


What's the percent that goes towards running the overall agency? Do they have a 990?
And I disagree that it is one of the best thing we can do for struggling nations, but that it is just one of many things we can do.
The End of Poverty by Jeff Sachs explains a wide number of things that can help the developing world. But the key lesson from him is that we cannot assume a one size fits all, that we must tailor aid packages and programs to each nation to fit its needs. Shock therapy and debt forgiveness will not be the cure for Africa as it was for Poland.
How does it deal with nations that lack the necessary infrastructure and law frameworks? Or does it simply not even try in those areas? Because without the necessary infrastructure to allow a market to function, a micro loan is rather pointless.
Edited by obvious Child, : No reason given.

This message is a reply to:
 Message 1 by jar, posted 12-25-2007 12:51 PM jar has replied

Replies to this message:
 Message 10 by Modulous, posted 12-31-2007 6:47 AM obvious Child has not replied
 Message 11 by jar, posted 12-31-2007 9:52 AM obvious Child has replied

  
Modulous
Member
Posts: 7801
From: Manchester, UK
Joined: 05-01-2005


Message 10 of 38 (444859)
12-31-2007 6:47 AM
Reply to: Message 9 by obvious Child
12-31-2007 4:14 AM


From their FAQ
8. When is microcredit not appropriate?
"Microcredit may be inappropriate where conditions pose severe challenges to loan repayment. For example, populations that are geographically dispersed or have a high incidence of disease may not be suitable microfinance clients. In these cases, grants, infrastructure improvements or education and training programmes are more effective. For microcredit to be appropriate, the clients must have the capacity to repay the loan under the terms by which it is provided."
Access to this page has been denied.

This message is a reply to:
 Message 9 by obvious Child, posted 12-31-2007 4:14 AM obvious Child has not replied

  
jar
Member (Idle past 393 days)
Posts: 34026
From: Texas!!
Joined: 04-20-2004


Message 11 of 38 (444882)
12-31-2007 9:52 AM
Reply to: Message 9 by obvious Child
12-31-2007 4:14 AM


What's the percent that goes towards running the overall agency? Do they have a 990?
None of the loan goes to Kiva.
And I disagree that it is one of the best thing we can do for struggling nations, but that it is just one of many things we can do.
There was a reason I said one of and we. These are things that the individual can do and of course, it is not all that can be done.
Another of my favorites is "Playpumps International".
The End of Poverty by Jeff Sachs explains a wide number of things that can help the developing world. But the key lesson from him is that we cannot assume a one size fits all, that we must tailor aid packages and programs to each nation to fit its needs. Shock therapy and debt forgiveness will not be the cure for Africa as it was for Poland.
That is not a good enough reason to not try this.
How does it deal with nations that lack the necessary infrastructure and law frameworks? Or does it simply not even try in those areas? Because without the necessary infrastructure to allow a market to function, a micro loan is rather pointless.
So you don't make the loan in that case.
But remember, these are person to person transactions. Even in areas without the normal legal infrastructure it may be possible to make a micro loan. As with anything else, you start small and test the waters. If it succeeds you then make more such loans.

Immigration has been a problem Since 1607!

This message is a reply to:
 Message 9 by obvious Child, posted 12-31-2007 4:14 AM obvious Child has replied

Replies to this message:
 Message 12 by obvious Child, posted 12-31-2007 5:31 PM jar has replied

  
obvious Child
Member (Idle past 4115 days)
Posts: 661
Joined: 08-17-2006


Message 12 of 38 (444980)
12-31-2007 5:31 PM
Reply to: Message 11 by jar
12-31-2007 9:52 AM


quote:
None of the loan goes to Kiva.
That isn't what I asked. I asked how much of the donation goes towards running Kiva. Non-profits for the most part require a certain percentage to operate. The rest goes towards the people and places they are trying to help. Some of these non-profits are better then others, such as Penny Arcade's Child's play which has a virtually unheard of 100%, and some non-profits largely exist to pay their CEOs.
quote:
That is not a good enough reason to not try this.
Agreed, however, it is a good reason to try other things first, particularly in Africa. As Modulous has cited, conditions may exist which would render Micro loans useless. Thus we should focus on a tailor made aid program to fix the conditions to allow micro loans to function.
quote:
But remember, these are person to person transactions. Even in areas without the normal legal infrastructure it may be possible to make a micro loan. As with anything else, you start small and test the waters. If it succeeds you then make more such loans.
That's not what I'm worried about. Without things like passable roads and safe markets, the problems of a weak legal system are pretty minor. If they cannot even make the basics of their business work due to fundamental flaws in their physical infrastructure, we shouldn't, as you stated, make a loan.

This message is a reply to:
 Message 11 by jar, posted 12-31-2007 9:52 AM jar has replied

Replies to this message:
 Message 13 by jar, posted 12-31-2007 5:37 PM obvious Child has replied

  
jar
Member (Idle past 393 days)
Posts: 34026
From: Texas!!
Joined: 04-20-2004


Message 13 of 38 (444981)
12-31-2007 5:37 PM
Reply to: Message 12 by obvious Child
12-31-2007 5:31 PM


That isn't what I asked. I asked how much of the donation goes towards running Kiva. Non-profits for the most part require a certain percentage to operate. The rest goes towards the people and places they are trying to help. Some of these non-profits are better then others, such as Penny Arcade's Child's play which has a virtually unheard of 100%, and some non-profits largely exist to pay their CEOs.
I don't know how to make it any clearer. Zero percent of the money loaned goes to Kiva. Kiva is supported by donations specifically directed to supporting Kiva and unrelated to the loan streams.
These are loans, not donations.
As to the rest of your post...
whatever.

Immigration has been a problem Since 1607!

This message is a reply to:
 Message 12 by obvious Child, posted 12-31-2007 5:31 PM obvious Child has replied

Replies to this message:
 Message 14 by obvious Child, posted 12-31-2007 5:45 PM jar has replied

  
obvious Child
Member (Idle past 4115 days)
Posts: 661
Joined: 08-17-2006


Message 14 of 38 (444984)
12-31-2007 5:45 PM
Reply to: Message 13 by jar
12-31-2007 5:37 PM


quote:
I don't know how to make it any clearer. Zero percent of the money loaned goes to Kiva. Kiva is supported by donations specifically directed to supporting Kiva and unrelated to the loan streams.
Do you have a tax form for that? It should be a 990.
http://www.kivafriends.org/index.php/topic,562.0.html
That's all I can find but there's a error message when it opens.
It appears I have massively overestimated the economics, political, business and legal knowledge of people here.

This message is a reply to:
 Message 13 by jar, posted 12-31-2007 5:37 PM jar has replied

Replies to this message:
 Message 15 by jar, posted 12-31-2007 5:46 PM obvious Child has replied
 Message 18 by Modulous, posted 01-01-2008 8:16 AM obvious Child has replied

  
jar
Member (Idle past 393 days)
Posts: 34026
From: Texas!!
Joined: 04-20-2004


Message 15 of 38 (444986)
12-31-2007 5:46 PM
Reply to: Message 14 by obvious Child
12-31-2007 5:45 PM


It appears I have massively overestimated the economics, political, business and legal knowledge of people here.
That's fine. Enjoy.

Immigration has been a problem Since 1607!

This message is a reply to:
 Message 14 by obvious Child, posted 12-31-2007 5:45 PM obvious Child has replied

Replies to this message:
 Message 16 by obvious Child, posted 12-31-2007 5:48 PM jar has not replied
 Message 17 by molbiogirl, posted 12-31-2007 6:17 PM jar has not replied

  
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