Sunday, October 28, 2007

Kiva: The power of Micro Loans

By Ben Cohen

Over the past 30 years, the IMF and World Bank have done their utmost to wreck the economies of the Third World under the guise of 'liberalisation', possibly beyond repair. Extortionate loan repayment schemes and radical economic reconstruction have plunged countries in Latin America and Africa into grinding poverty and spiraling debt. The poor rarely see the money loaned to their governments, and are frozen out of the high growth seen by minute sectors of the corporate elite. There is however, something you can do.

It's not the answer, but community based lending schemes are providing an alternative to this mess, connecting the borrower and the lender directly. The company 'Kiva' is a great example of this.

"Kiva lets you connect with and loan money to unique small businesses in the developing world", says their website. "By choosing a business on Kiva.org, you can "sponsor a business" and help the world's working poor make great strides towards economic independence. Throughout the course of the loan (usually 6-12 months), you can receive email journal updates from the business you've sponsored. As loans are repaid, you get your loan money back."

Apparently, these type of loans are paid back 99% of the time, so are a very safe investment. Although our governments should be the ones eradicating the punitive loan schemes offered to the third world, they can no longer be trusted to do so. Check Kiva's website for more info.

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