Saturday, January 10, 2009

Kiva: Loosening my Social Entrepreneurship Credit Today

I read a week of Wall Street Journals today. Lots of articles about worsening credit. The only lending I do is through so I've doubled the money I've channeled into the system.

Kiva is creating an impact. This week alone Kiva lent out nearly $800,000, and 7000 more people started lending. The default rate is 2.85 percent and the delinquency rate is 2.21 percent. Incredible.

Mohammed Yunus said that credit should be everyone's birthright. Not the kind of credit that got Wall Street and Main Street in trouble but enough to feed, clothe and shelter one's family. Its a powerful thought. Kiva is empowering those who are lending, to give these people a chance to do exactly that.

I looked at some interesting benchmarks. The average Kiva lender has lent $134 to date and received $75 back through 3.6 loans. This isn't the total amount lent out. It includes all the loans through money that was recycled. $59 is still in the system and in June there are 400,000 lenders, which means Kiva has $24MM in the system right now.

One billionnaire could increase that amount 50 times. Even at a 2-3 percent delinquency rate, that is a 25 percent better return than the Nasdaq. The personal social return is priceless.
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