There's real joy in giving

I've been thinking of micro-lending quite a bit these past few years (since I first read about Muhammad Yunus and his Grameen Bank). I knew individuals could lend small amounts of money as a potential source of income, but that's not the same thing. Although not averse to making money, this wasn't a money-making project for me. I wanted to help people get started so they can become self-sufficient and rise out of poverty. I just didn't know how to go about it.

I found Heifer International, an organization that donates animals that can help feed a family or make income. (World Vision also runs a similar program.) It was close, but it wasn't quite what I was looking for.

And yet again, fellow bloggers to the rescue! I found out about Kiva through this post by J.D. at Get Rich Slowly and, just before Christmas, I made my first loans.

Now, if you simply google "microlending," you'll find lots of micro-lending sites, including Kiva. After reading a few, I decided that what I liked about Kiva is:

1. It's an aggregator site for hundreds of microfinance institutions (MFIs), which it rates based on past performance. It saved me tons of research and made me feel more confident in my choices.
2. Unlike Heifer or the Grameen Foundation, you decide who gets your loan, so it's easy to align your lending with your strategic philanthropy goals.

I'm not putting the others down, it's just that Kiva fits better with how I like to do things. (Okay, maybe I'm a bit of a control freak?)

Here's how it works:

• Kiva posts entries about people looking for loans, the amount they need and what they'll do with it. Additional information includes the applicant's loan history, if any, info on the MFI that will be advancing the funds and their track record. It also includes the proposed repayment schedule and the amount raised to date.
• You can donate any amount you want, from $25.00 up.
• Payments go through Paypal.
• You get regular email updates on your loan.
• As loans are repaid, you can then decide to take your money or reinvest it in other loans.

The website is easy to navigate and very user-friendly. You get your own "portfolio" page which tracks your loans and repayments. Each lender gets a profile page so you can check who else loaned money to "your" projects.

Whoever designed this website definitely had the lenders in mind, which probably also influenced my decision to choose them.

I'm very excited about my first 3 loans. I'm planning to gradually add funds over the year until I reach a total of $1,000, which I'll then just recirculate into new loans as they get repaid.

For the first time ever, I feel that I'm making a real difference in a real person's life. In a weird way, it's the same pleasure I derive from knitting or baking: "I made this." Sometimes, just giving money is not enough. Seeing what your small loan can accomplish makes all the difference.