My Two Most Recent Investments

A few weeks ago, I wrote a post about a new microfinance intermediary called Kiva. Kiva is a web-based system that allows individuals to participate in making loans to small businesses in developing countries. With a credit card and PayPal, you can invest as little as $25 in helping someone in a developing country start a business or improve their life. Kiva works with microfinance organizations around the world that have a history of making these types of loans. While the local microfinance organization charges interest for the loan, neither Kiva nor the individual investor receives interest.

I have invested less than $100 in two businesses. Their loans begin on Monday, May 1, and will continue for over a year. I wanted to introduce you to the two businesses I have invested in, and throughout the year, I will give you periodic updates on how the businesses are doing. I hope to make others aware of this unique way to invest in the economic well-being of the poor.

Mary Njeri Nganga
Njeri Pig Project

Partner: Women`s Economic Empowerment Consort
Partner Rep: Jedidah Waigwa, Martha Gitau
Location: Gathiga, Kenya
Activity: Rearing of pigs
Loan Amount: $550.00
Loan Use: With a loan of USD 550, Mary plans to buy more pigs.
Start Date: May 1, 2006
Loan Repayment Term Range: 12-16 months
Status: loan has been raised

"This business is a member of the Melody Mothers Women group. Group lending, also known as solidarity lending, is a mechanism that allows a number of individuals to provide collateral or guarantee a loan through a group repayment pledge. The incentive to repay is based on peer pressure; if one group member defaults, the other members make up the payment amount. - Kiva Staff"

Mary is married with two children who are in secondary school. She is a member of the Church of God in Kenya. Mary was born into an extended poor family. Due to a lack of school fees, she dropped out of school at primary school level and got married.

She started rearing pigs when she was advanced a loan of USD 221 by WEEC in 2003. In 2004, she received another loan of USD 368. The loan enabled her to buy more pigs. Through training from the Ministry of Agriculture and Livestock and WEEC, on livestock and business management, she can use the modern and improved methods of rearing pigs. To date, she has ten pigs. She has orders at Wangige and Nairobi.

Partner: Life in Africa Foundation
Partner Rep: Christina Jordan, Grace Ayaa
Location: Banda-Kireka, Uganda
Activity: Building a new home.
Loan Amount: $275.00
Loan Use: Purchase building materials.
Start Date: May 1, 2006
Loan Repayment Term Range: 12-14 months
Status: loan has been raised

Robert Ocora
Ocora Family Resettlement

Robert Ocora, was born in the northern town of Kitgum in 1979 and has lived there until the war was unbearable when he moved to Kampala in 2002. His father was among those killed by the rebels, when he was just ten years old, and watching this happen, it was impossible for him to continue living in that situation. Thus the decision to look for a safer place. This then was then when he came to Kampala.

While in Kampala Robert now as an adult married with 1 child, started learning building skills this was through giving a hand to the mason. This could not earn him enough money so he decided to join the rest at the stone quarry, a job he did until the news of the bracket project by life in Africa knocked on his door.

This gave him a lot of uplift in his earnings that during the few months of working with them, he managed to acquire a small plot that he now wished to develop into a family house.

He therefore seeks a loan of 500,000/= which he will pay back in 12 mouths at 50,415 @

Budget

Bricks 1500 x 60/= - 90,000/=
Cement 5bags x 18,000/= - 90,000/=
Iron sheets 15 x 10,000/= = 150,000/=
Roofing poles 10 x 3000/= - 30,000/=
Sand 1 trip x 6,000/= - 60,000/=
Doors and window frames – 40,000/=
Transport – 30,000/=
Contingency – 10,000/=
Total ----------- 500,000/=

Since he already has building skills, Robert will be doing his work himself so no labour cost. After this Robert plans to get a bigger land where he will build rental houses that will enable his children go to school. Robert has designated the community impact portion of the interest he will pay on this loan to support educational opportunities for LiA member children.

I invite you to read more about Kiva by clicking here or on the symbol below.

Comments

[Quotidian Grace]

This is fascinating! I love the idea--it's similar to "adopting" a child by sending contributions to a group that helps them. I'm going to link this on my blog.

[Intheway]

I love this whole idea.
Below is the link to one that I've invested in. I'm planning to expand my investments soon.

http://intheway.typepad.com/in_the_way/2006/04/ending_poverty_.html

What I really love about this - it is giving that you can use to help multiple people. Once the loan is repayed, then if you want you can re-invest it to help someone else. If we can get the tools (and capital is a tool) to help them create a better life for themselves - then they have a chance of moving beyond poverty - at least on their local level. My hope is that this will catch on and perhap entire communities could be impacted as several small businesses grow maybe they could offer employment opportunities for others - money kept in the local economy will certainly benefit others.

Blessings

John.

[Fiona Ramsey]

Thanks for the support Michael. Bloggers such as yourself are such a blessing for Kiva and are really helping us spread the word.

Capital is a tool. "Teach a man to fish..." Problem is the world is full of men who know how to fish, but just can't get hold of a net. It's so exciting from our end being in the middle of these powerful connections that are being made that are simultaneously changing lives. Personally I love the hope that we're all feeling... we can fight poverty, if we all get together and make small loans, we can make a difference in a *sustainable* way. I hope you enjoy your loaning experience, WEEC is a great organization.

Many blessings,

Fiona Ramsey
Community Relations and Operations Manager
Kiva.org
[email protected]

[Michael Kruse]

Thank you Fiona. When I was in graduate school in at Eastern University ('87-'89) I knew some folks who played with idea of doing what you are doing but in pre-internet days it was simply to complex. I am glad someone else has caught the vision and followed through.

May God richly bless the work you all are doing.