Kiva.org is a microloan website that allows you to loan money for entrepreneurs in developing countries. According to the New York Times, Kiva is occasionally too popular and runs out of people that need loans. The process of finding people and approving them to receive loans takes a lot of time. As soon as Kiva was featured on Oprah, the site received a ton of traffic and actually ran out of entrepreneurs that needed money. Other reasons such as Christmas gift certificates and television shows have added to the popularity of the website. Some repeat donors are feeling guilty that they are donating money and others do not have the opportunity to give.
Tim Leberecht from CNet quotes James Surowiecki , saying that Kiva is too limited in who they accept for people receiving loans. He says that “Businesses that can generate jobs for others are the best hope of any country trying to put a serious dent in its poverty rate.“ Kiva only approves people who are in poverty and personally need the help. Leberecht feels that more donating options would help get rid of poverty in developing nations. I personally agree with Leberecht and Surowiecki, and I feel that more donating options would help with Kiva’s problem of too many donors.
2 Responses to “Kiva's business model is too good”
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I agree, i feel like there are so many people in need that there is no such thing as “too many donors”, it would be a shame to turn donors away when there are so many other causes that are just as legitimate. Maybe they could even put links to other websites that look for donations for other similar causes.
One of the strengths of microfinance is that they take time to form groups of people that will help in the accountability factor of repaying the loan. I think if they start rushing the process they will find that the default rate skyrockets.