InsideBayArea.com: Kiva does well, with help from friends
IF YOU HAVEN'T yet heard of Kiva.org, a San Francisco nonprofit that at just 18 months old is already the leading online microcredit site, you're about to. Its friends in Silicon Valley will make sure of that.
Here's how Kiva — which means "unity" in Swahili — works: Lenders visit Kiva's Web site to find entrepreneurs from developing countries looking for a small loan. Kiva posts the entrepreneurs' funding needs and pictures online with the help of 38 local microfinance institutions around the world.
Anyone willing to lend as little as $25 — perhaps to Peter Muchiri, a furniture maker in Kenya who needs carpentry materials, or Roza Boguckaya of Tajikistan, who wants to expand her bakery — does so through the site, where they can also track the entrepreneur's progress as they repay their loans, typically over a one-year period.
To date, nearly 40,000 people have used Kiva to lend money to 5,000 borrowers in transactions totaling $3.3 million. No one has defaulted on their loan just yet, though 10 percent are falling behind on their payment schedules.
It's a remarkably simple system that highlights the power of online communities. Yet just as remarkable is how adeptly Kiva has harnessed the collectivepower of the Silicon Valley tech community. …
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