Wednesday, November 02, 2011

How to give Kiva loans

"I feel good about helping people around the world to make better lives for themselves, their families and their communities."

How I did it: Since early January I have made 11 Kiva loans of $25 to various people around the world. I actually used only $100 out of pocket. As repayments came in, I would re-lend the money. I plan to continue indefinitely but I'm going to call it done as far as one of my 43things.

Lessons & tips: Read how Kiva lending works. You receive no interest, only principal. There is a chance that the borrower will not pay back or will get behind in payments, but to date I have had no problem.

I make a $25 loan once a month. I need that discipline so I don't go overboard. I select half a dozen candidates, compare their criteria, then make my choice of the one individual I will lend to at that time.

My criteria: short term (6-7 months); prefer individual versus group; money will be used to build a business - in which the borrower has previous experience and success; lending partner (bank) has positive Profitability (Return on Assets); helpful if borrower is in top 5 pages for Popularity and Amount Left.

I also listen to my gut. You can't judge a book by its cover, but I listen to the vibe coming from the borrower's photo. That's not to say I haven't lent to someone who frowns. I let my intuition have a say.

Resources: Kiva.org

Excel - I created a spreadsheet where I enter data about the criteria that I spelled out in Lessons and Tips. I sort the data to see who is most qualified.

It took me 10 months.

It made me Happy

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