Friday, June 12, 2009

Kiva - About Microfinance

Kiva is now making loans in the US as well. Interesting. I realize the literature is very mixed on microfinance, but it has been my experience that many of these borrowers have no other access to capital. Plus with with high repayment rates, I think it is definitely worth a try. Better than charity and more

Kiva - About Microfinance:

This page contains information we have gathered from coleagues, friends, and microfinance organizations we respect to help answer some of your questions.....

"Microfinance is the supply of loans, savings, and other basic financial services to the poor." (CGAP)

As the financial services of microfinance usually involve small amounts of money – small loans, small savings etc. – the term "microfinance" helps to differentiate these services from those which formal banks provide.

Why are they small? Someone who doesn't have a lot of money isn't likely to want to take out a $5,000 loan, or be able to open a savings account with an opening balance of $1,000. Hence – "micro".

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