Micro Investments, Good Causes

Matt Mecham:

Kiva is a website that allows one to invest in companies located in developing parts of the world. In a nutshell, you offer an interest free micro-loan (from $25 upwards) to pre-vetted companies registered with the website. When the company has enough lenders, they are given the money with a view to paying it back.

Personally, I think this is a break-out idea that can have a real impact on poverty in developing countries. Small donations to large organizations can be frittered away and make little impact into helping the cause they support but loaning money directly to people trying to start up or expand their small businesses will really help.

Selfishly, it also makes one feel good knowing that you’ve helped a small business and you may even get your money back to withdraw or re-invest. So far Kiva has a 100% repayment rate although you should accept that you may not get your money back.