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Bank of Bob: 1 man's journey into microlending- most important article you'll read in your life?
the world is being massively held back (in terms of economic development and equity) by traditional modes of supplying capital to those with objectives but lacking the means. Traditional lenders have completely ignored those who don't already have wealth. But these are the people who can produce the greatest gains to society - if given the chance.
Bank of Bob: One man's venture into microlendinghttp://www.news-leader.com/usatoday/article/2435759
Bob Harris, former stand-up comedian, "Jeopardy" contestant, and television writer, got a plum assignment covering the world's most luxurious hotels for ForbesTraveler.com in 2008. While staying in hotels that would bankrupt most people overnight, he took an interest in the poverty that surrounds so many luxe establishments. And that, in turn, led him to invest his earnings from Forbes at Kiva.org, which allows people to make small loans - as little as $25 - to people in lesser-developed nations. "The International Bank of Bob," now in bookstores, is his story about making those loans, and visiting Kiva.org borrowers around the world. USA TODAY reporter John Waggoner interviewed Harris on his newfound role as an international lender.
Q: You have a lot of good things to say about Kiva.org in your book. Are there any caveats you'd add?
A: I don't have a lot of caveats. The thing works: You do get paid back more than 99% of the time. If you go to a major Wall Street bank, rates are virtually nothing. If you deposit $25, a year later you have the same $25, plus a small pile of pennies. Through Kiva, you'd have the same $25, minus a small pile of pennies. And for that you could be helping someone in West Africa buy a cow or repair a taxi. I'd rather have that $25 helping a Bangladeshi fisherman and know what he's doing with it, than tossing it into a big Wall Street bank.
Q: What about the interest borrowers pay? Kiva.org funnels money to lenders, who get interest, but people who contribute to Kiva.org get no interest, right? Isn't there some concern that the local lenders charge a high interest rate?
A: At Kiva, you're lending money at no interest, and you're getting a negative 1% rate. A lot of Americans, when they look at the rates borrowers are paying in the field, those rates seem comparatively high. But in India, education loans are 9%, but the inflation rate is 7.5%. So you have to put the rates into local context. I never met a client in the field who complained about the interest rates.
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Q: You have a lot of good things to say about Kiva.org in your book. Are there any caveats you'd add?
A: I don't have a lot of caveats. The thing works: You do get paid back more than 99% of the time. If you go to a major Wall Street bank, rates are virtually nothing. If you deposit $25, a year later you have the same $25, plus a small pile of pennies. Through Kiva, you'd have the same $25, minus a small pile of pennies. And for that you could be helping someone in West Africa buy a cow or repair a taxi. I'd rather have that $25 helping a Bangladeshi fisherman and know what he's doing with it, than tossing it into a big Wall Street bank.
Q: What about the interest borrowers pay? Kiva.org funnels money to lenders, who get interest, but people who contribute to Kiva.org get no interest, right? Isn't there some concern that the local lenders charge a high interest rate?
A: At Kiva, you're lending money at no interest, and you're getting a negative 1% rate. A lot of Americans, when they look at the rates borrowers are paying in the field, those rates seem comparatively high. But in India, education loans are 9%, but the inflation rate is 7.5%. So you have to put the rates into local context. I never met a client in the field who complained about the interest rates.
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[font size="+1"]Kiva - Change a Life for $25: http://www.kiva.org/start[/font]
[font size="+1"]Change a life for $25[/font]
Every day, Kiva connects thousands of people to borrowers and partner institutions around the world, working together to create opportunity and alleviate poverty. It only takes $25 to get started.
Kiva lenders combat poverty daily by making small loans to borrowers around the world. We believe in fair access to affordable capital for people to improve their own lives.
Often only a relatively small amount of money stands in the way of Kiva borrowers and their dreams. Whether it’s a Kenyan farmer who needs $500 in order to double her grain production, or a young Bolivian woman who lacks the $1,500 tuition for nursing school, Kiva lenders provide a hand up to these and countless other borrowers.
Join us and make a loan today.
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Interested in changing the World? Try person to person aid. If enough of us do this, we just might change the World (in time).
Kiva home page
