Microfinance and its Increasing Popularity

About a year ago, I was first introduced to the idea of microfinance through the website Kiva.org. I was fascinated by the idea and inspired by the organization. In fact, last year instead of purchasing Christmas presents for my family members, I donated $100 to the Kiva website and my family and I chose entrepreneurs from the website to invest in.

The idea of directly investing in an entrepreneur’s personal development from halfway across the world was something really exciting. As my parents themselves are entrepreneurs, they liked the idea that they were not “donating” money, but rather “investing” in fellow entrepreneurs. It is not a donation, it is a loan; this is not only important for us, but is also important for the borrowers. They are improving their own economic situation.

As Jessica Jackley, co-founder of Kiva, explains in her TED Talk, when she went to Kenya, Uganda, Tanzania:

I never once was asked for a donation, which had kind of been my mode, right. There’s poverty, you give money to help — no one asked me for a donation. In fact, no one wanted me to feel bad for them at all. If anything, they just wanted to be able to do more of what they were doing already and to build on their own capabilities.  Because the best way for people to change their lives is for them to have control and to do that in a way that they believe is best for them.

The idea of being able to allow people to improve their own lives, in their own manner, was what really attracted my family and I to microfinance.

My family and I lent $50 to two borrowers in Kiva last Christmas.