Organizations like Kiva and HOPE International are at the forefront of a unique and relatively recent model for charitable giving. Traditionally, money given to benefit the poor in other countries around the world meant paying for charity organizations to work in communities to provide food, clean water and other forms of relief. The problem here is that the donation only goes so far.
There is an old saying that goes something like, “You can either give a man a fish and feed for a day, or teach him to fish and feed him for the rest of his life.” What this means is that while giving is a good thing, it isn’t sustainable. Micro financing fits better into the second half of this saying. The basic concept is that small donations are compiled into relatively small loans, usually ranging from a couple hundred dollars to a couple thousand. This money is given to entrepreneurs in poor countries to help them start a self-planned business. Examples are the cost of a bicycle so that they can deliver groceries or the start-up costs of a small street vendor. With a very high payback rate (both Kiva and HOPE claim 98-99% rates), donors know that they are giving to a worthwhile cause, and can even reinvest the money after it has been paid off!
Visit these two great organizations’ sites to help out your fellow entrepreneurs around the world:Read More