Rhymes with Cars

Muhammad Yunus won the Nobel Peace Prize earlier in the week for his work as the founder of the Grameen Bank in India. Grameen split the prize. Grameen Bank focuses on micro-finance & micro-credit, the process of providing 3rd world inhabitants small business loans as a way to wipe out poverty. I became interested in micro-finance via Dave McClure's site and his support of Micro-Finance and Kiva in particular. While I still haven't bought in 100% to the concept, friends and relatives will most likely get Kiva gift cards for the holidays so that I can try it out on a small scale. It will be cool to see what my network does and who they fund. I have to admit, when I first read about Kiva and MF, I kind of thought that it was a bit like Sally Struthers asking to send $1.00 a week or whatever to support little Starvin Marvin. As I've done a deeper dive on MF, I'm finding that the process is more of the 'teach a man to fish' concept. In short, MF is a small loan, typically less than $100, that is given by one individual to another in order for that person to start or help build their own business. In the case of Kiva, you can lend money to someone in Uganda to open a store or someone in Cambodia to build their food services business or any number of other loans. These are no-interest loans, but impressively, Kiva boasts a 100% return rate. In fact, MF has a 97% return rate for it's loans. This money can then be rolled into other businesses or withdrawn. Global poverty is a major issue. It's great to hear about Bill Gates, Bill Clinton, Richard Branson & Bono (the four horsemen of the apocalypse?) trying to do something about global poverty, but there isn't a lot of opportunity for the average joe to drop a few billy on solving this problem. Plus, it's easy for someone to say 'Screw it, the Dollar Bills have got that one covered and I'm having a tough enough time making rent and covering my Escalade payments.' Micro-finance makes it simple and relatively risk free to help someone out. To use the cliche, it isn't a hand out, it's a hand up and odds are, when you get your $25 bones back, you'll want to lend it to someone else so that she can build her Honduran fish mongering practice into a business to feed her family and her village.