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Tinalles
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Joined: 22 Mar 2008
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Location: Grand Forks

PostPosted: Fri Apr 18, 2008 10:19 am    Post subject: Microloans Reply with quote

I've just made my second micro-loan. It's really cool - back in the nineties some guy realized that there are a ton of entrepreneurs in the third world who cannot get loans at any kind of reasonable interest, because the amounts they need are so small (a few hundred here, a thousand there) that most banks won't touch them. So he figured that the best way to help those people get loans was to do direct person-to-person loans between people in wealthy nations and those in poorer ones; a micro-loan. It's not charity, even; the recipient is expected to pay it back, usually with either low interest or no interest at all. I think he won a nobel peace prize for the idea.

Anyway, the Internet is really awesome at person-to-person connections like that, and there's this outfit called Kiva.org that facilitates these kind of loans. They partner with local groups across the globe; the local groups find people who need loans, Kiva posts the loan request, and random people from all over make small contributions until the loan amount has been met. Kiva forwards the money to the local group, who gives it to the entrepreneur, who uses it and makes payments over the course of a year or 18 months or so. The payments are collected by the local group and sent back to Kiva. Once it's all paid back, you can withdraw the money or use it to sponsor somebody else.

A while back I lent $25 to a woman in Western Samoa to help her expand her business making hand-woven purses of palm for the tourist business. She paid it back all back over the course of a year or so, and then I lent out the same $25 to a Bosnian woman in the construction business. Today I put in a second $25, this time for a woman running a small grocery store in Mozambique. I thought about lending to this guy in Cambodia, but I couldn't figure out why a fisherman needs lotus plants. He wants to buy fish nets, which I can understand, but the lotus plants didn't make sense to me. Oh, well - he'll probably get his loan.

Anyway, just thought I'd post about this. I know Violabelle does this too, she's the one who introduced me. It's a really great way to help out, and cheap too.
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horsin'around



Joined: 22 Mar 2008
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PostPosted: Fri Apr 18, 2008 11:23 am    Post subject: Reply with quote

This is fascinating; I remember reading about it somewhere awhile ago, but didn't pay it much mind. It's really beginning to expand!
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Asenath83



Joined: 14 Apr 2008
Posts: 47

PostPosted: Fri Apr 18, 2008 11:30 am    Post subject: Reply with quote

That's a fantastic idea! Thank you for sharing.
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Violabelle



Joined: 23 Mar 2008
Posts: 183
Location: Springtime

PostPosted: Fri Apr 18, 2008 5:58 pm    Post subject: Reply with quote

Yay Tin! Very Happy Here's my portfolio if anyone is interested. Honestly, it feels really good to being doing something to help the world instead of just talking about it.
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Tinalles
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Joined: 22 Mar 2008
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PostPosted: Fri Apr 18, 2008 9:31 pm    Post subject: Reply with quote

Oo, I didn't know we had lender profiles. Here's mine!

http://www.kiva.org/lender/tinman
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thespaceinvader



Joined: 23 Mar 2008
Posts: 650
Location: Cardiff, UK

PostPosted: Sat Apr 19, 2008 4:23 am    Post subject: Reply with quote

I;m interested in this project, but I'm having a frustratingly difficult time finding out one key fact: what is the interest rate on these loans, and hence,w hat is my return as an investor - I figure you guys might be able to answer that, since you've done it already...
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Violabelle



Joined: 23 Mar 2008
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PostPosted: Sat Apr 19, 2008 9:14 am    Post subject: Reply with quote

Interest rate is 0- you only get back the money you put intially. It's not a bank, but it's not really a charity, either. So I loaned out my first 25$, got it back in a year, and loaned it out again.
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thespaceinvader



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PostPosted: Sat Apr 19, 2008 9:41 am    Post subject: Reply with quote

OK. It seems something that they're reluctant to talk about on the website.

I might start up an investment sometime soon.
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YatesOfYore
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PostPosted: Sat Apr 19, 2008 1:48 pm    Post subject: Reply with quote

I think this is really interesting... I'll have to look more into it when I get home from my trip Very Happy

(I am also amused that Vi is funding a liquor shop XD)
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Lady Calie



Joined: 14 Apr 2008
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Location: somewere in texas

PostPosted: Sat Apr 19, 2008 5:23 pm    Post subject: Reply with quote

This does look interesting maybe if i get a job over the summer i can do so but not now when my money = dad's money >.>;;

(i also find it amusing that Vi is funding a liquor store ^^;; )
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Sparrow



Joined: 14 Apr 2008
Posts: 100
Location: One of many comfy couches in the known universe

PostPosted: Sun Apr 20, 2008 3:35 pm    Post subject: Reply with quote

Wow, this is really intriguing. As soon as my next paycheck comes in, I'll do some exploring.

Edit: I wanted to credit Tin or Vi when I registered, but you two have no visible email D: Ah well.


Last edited by Sparrow on Sun Apr 20, 2008 5:43 pm; edited 1 time in total
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Violabelle



Joined: 23 Mar 2008
Posts: 183
Location: Springtime

PostPosted: Sun Apr 20, 2008 4:25 pm    Post subject: Reply with quote

When I was choosing my loan that time, I was like, 'how can I not fund a liquor store?!?!'
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Tinu.



Joined: 23 Mar 2008
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Location: The land of dreams

PostPosted: Mon Apr 21, 2008 8:50 am    Post subject: Reply with quote

wow, this is really interesting. If I get a job this summer I'll have to look into doing this. =)
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Tinu.



Joined: 23 Mar 2008
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PostPosted: Tue Apr 22, 2008 8:53 am    Post subject: Reply with quote

(sorry for the double post)
This has really grabbed my interest, so I think I'm going to write my weekly article for Journalism on it. Would anyone object if I quote them?
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Tinalles
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Joined: 22 Mar 2008
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Location: Grand Forks

PostPosted: Tue Apr 22, 2008 12:46 pm    Post subject: Reply with quote

Fine by me.
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