Wednesday, July 21, 2010

Powerful answer to "Does Microfinance work?"

A few well-formed words can have an amazing impact! I saw the below tweet from a friend earlier today, and that set off a chain of thought, answering some unanswered questions from long ago, and resulted in a concrete action making a small impact for a few people.

I am involved with micro-lending through Kiva for a couple of years now, and have been a believer in the concept of Micro-finance. Since starting to lend on Kiva, I have come across a few articles on the internet which question the benefits of Microfinance. While not going into the details of these articles, suffice it to say they did succeed in sowing a seed of doubt in my mind about the value of the loans I make. I have continued to revolve the initial money I put into Kiva within the same network by lending it to other entrepreneurs. A touch of skepticism - and even resignation - has accompanied these actions.

The comparison between Microfinance and Mortgage loans in the tweet dispelled whatever undistinguished doubts I had about Microfinance, and made me very clear about why I lend on Kiva :
I am fortunate on numerous counts in my life; I live a privileged life compared to the majority of the people in the world. Kiva - & Microfinance - is a way to provide an opportunity to a few people who wouldn't have got that opportunity otherwise.
Following the above epiphany, as soon as I got some time to spare, I logged on to Kiva, and added a few more loans to my portfolio.

One 'short-coming' of Kiva is that it does not have Microfinance partner organizations in India; so all my loans on Kiva are to people in many countries across the world excluding India. Recently got to know of a Kiva-clone - United Prosperity - that addresses this gap in Kiva's offering. I have lent to a couple of entrepreneurs on United Prosperity as well.

I invite my friends to follow my example and make a difference for 'underprivileged micro-entrepreneurs' by lending on Kiva and/or United Prosperity. Thanks for reading this, and thanks for following up on my request!

3 comments:

Ravi said...

Good Post! And yes you have enthused me about micro financing. Kiva looks good.

Cheers!

prakash murthy said...

Awesome Ravi! Act before that enthusiasm is forgotten in the rush of routine stuff, open an account on Kiva and make a difference for a few people!!

prakash murthy said...

Awesome Ravi! Act before that enthusiasm is forgotten in the rush of routine stuff, open an account on Kiva and make a difference for a few people!!