Originally Posted by
ma91pmh
Well thanks to this thread I have already learned a lot about Kiva. Basically it looks like you are providing interest free financing to a series of enterprises that in turn lend that money on at huge interest rates to the end borrowers - justified by stating that the high rates (which are not disclosed despite a "transparency" claim) are not as high as other "local lenders". I am yet to be convinced any of the end borrowers have any resemblance to the people listed in the website. It's more like adopt a whale/dog/tiger type thing. You think you are adopting harry the humpback but in reality you are just giving money to some black box. So presumably for every 1 dollar you lend the borrower gets maybe 30 or 40 cents and the rest goes to these enterprises you folks are providing interest free financing for.
Maybe I am too cynical, but as I have said before, I find other ways to give back that I have more faith in.
Originally Posted by
sk8uno
This is what I learned, as well. I have never used Kiva, but my impression before this thread was that the borrowers received interest free loans. Now I see it is more akin to a Red Cross that charges the recipients of its aid.
Even though I've raised questions myself, I wouldn't necessarily jump to these conclusions. The issue really reaches beyond Kiva to microfinance more generally, but it is very possible that under some circumstances people really do get a chance to move ahead in life even though they pay interest rates that we would consider too high in a domestic context. And there are many other factors at play that make this a complicated issue and that mean that what Kiva does could well be very worthwhile.