October 11, 2005
Kiva.org Enables Personal Microfinancing
Kiva, the first nonprofit organization to enable socially-minded individuals to make personal loans to microenterprises in developing countries, launched its Web site (www.kiva.org) today. For the first time, Kiva.org opens the Internet to people looking for a personal, high-engagement means of taking steps to eradicate poverty in developing countries by lending money directly to small businesses.
It was co-founded by Stanford graduate Matthew Flannery (MA, BS '01) and Stanford MBA candidate Jessica Jackley Flannery, who spent time working in Uganda, Kenya, and Tanzania. The concept behind Kiva is simple: Bring together lenders and worthy enterprises the Kiva Web site, which lists businesses in need of funding and provides background on the entrepreneur starting the enterprise.
Customers may makes loans in increments as small as $25, and can expect to receive repayment, without interest, at the end of the loan term, which typically runs between six and 12 months. Loans are made via PayPal, a globally recognized online payment service. Lenders can stay abreast of the progress of the businesses to which they have lent via blog-like updates posted on the Kiva site. If lenders wish to correspond with the business owner, they can do so through the Kiva partner representative in Uganda.
"Microfinance is an exciting movement. Before Kiva, there was really no way for the individual—at lower price points—to get involved as a lender. We wanted people like us to be able to participate in the power of microlending first-hand," said Flannery. "We started Kiva because we saw loans as a very personal and sustainable way to help entrepreneurs across the world. When you loan to someone and get paid back, you get proof that a business has succeeded—and you are more likely to loan again. "
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Krista Van Lewen
Posted by Tony Wang at October 11, 2005 11:53 PM
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