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“Instead of giving fish to a hungry man, give him a fishing rod”

I don’t remember who said those words, but they make a powerful point. I was reminded of these words when I first came across Kiva, the organization that I’ve come to deeply love and respect. Kiva is a non profit organization that gives micro loans to poor people. So whats the big deal, you ask?

• They give loans that are as small as $100, no bank will even think of loaning such small amounts.
• They don’t require the borrowers to show any collateral or security to take loans. This makes it easier for even the poorest people to borrow.
• Their borrowers are entrepreneurs, doing various business - food, furniture, printing, plastics etc. These loans help the entrepreneurs sustain themselves and improve the economic condition of the cities (and countries) they live in.
• Kiva has a loan repayment rate of 100 % (How many organizations can make such a claim?)

I can go on and on, but my intention here is not to make a sales pitch for Kiva (they don’t need a sales pitch), but to highlight the amazing work they’ve been doing.

Here’s how they work (in brief):

• They partner with local organizations in the countries and regions they operate in.
• Entrepreneurs’ applications and thoroughly verified, and their profiles are posted at the site.
• Anyone from any part of the world can loan any entrepreneur(s) of their choice, only a credit card is needed (loans of $25 and above).
• Once the loan is raised, kiva’s local partners give the loan amount to the entrepreneur.
• The entrepreneur pays back the loan. Once the entire loan is repaid, its given back to the lenders.

I think its one of the best ways of helping someone in need. In a way, this is better than giving money to charity, because

• You precisely know how your money is being spent (you can keep track of your borrowers through journals and borrower’s pages)
• Instead of helping people just one time (which is the case with donations), you help them sustain themselves and stand on their own feet.
• You get back your money (Paypal account needed), which you can withdraw or loan to someone else (basically “recycle”)

Of course, there are times (like the tsunami, for example) during which donations are absolutely necessary. Otherwise, my vote goes to organizations like Kiva. I made my first loan of $25 this month, my intention is to do one loan of $25 every month, and keep re-loaning the money as and when I get it back.

If you like to know more and support kiva, check out these links:

• The Kiva story
• Kiva’s FAQ page
• Kiva blog

There are lots of Kiva enthusiasts throughout the world. These are some of my regular reads:

• Kiva Friends (forum)
• Ramon’s Kiva blog
• Adam’s “I love Kiva” (blog)
• Shelby’s “The Kiva Effect” (blog)
• Lend Me Your Goat (blog)
• MicroFinance Travels of Kendall Mau (must read)
• Agents of Change (they’re trying to raise a million dollars)

I’m sure there are many others that I’ve missed.

Kiva is growing big time, guys. The whole of last year they raised $2M and this month alone they are on track to raise $2M. Don’t feel shy, come and be a part of this amazing organization .  I’m eagerly waiting for Kiva’s entry into India.