Eileen's picks

And then there's no interest lending

Rating: 2.75 not yet rated(4 votes)    Vote:

You are logged in as | Logout

I've become a small scale microfinancier, lending money to a young mother improving her small farm in Azeribaijan, to a young entrepreneur in Mexico who sells shoes through catalogs, and to a co-op of ten women in Senegal, West Africa. Astou Ndoye and her friends used the money to purchase pineapples, mangoes, hibiscus flowers, baobab fruit and tamarind and are now manufacturing and selling juices and preserves.

One loan I helped fund, just made in August, is already 67% repaid.

No profit motive; more along the lines of "Those who have more also have more of an obligation to give back". Donating to charity is one way, sharing knowledge is another, and lending money at a fair, reduced or even zero rate to people who need it is another way. On each loan I get my capital back which I then use to make more loans. No interest, just capital.

A Bicycle Trust for strangers you might say.

The Zopa idea appeals to me too. A person in the US starting a small business, for example, can be financed by a number of regular people like me who buy CDs and voluntarily contribute a portion of the interest they could be paid to the person starting the business as a way of helping them.

Personally I really like that concept. It's not charity, it's not taking a risk because the CD is insured, and it's an opportunity to help someone get ahead. I'm willing to give 2% of the interest I might receive back to a borrower whose reason for needing the loan interested or moved me.

Kind of in the spirit of the season.

I do my international microfinance lending through Kiva, an organization I really like. The Gates Foundation is assisting Opportunity International and there are others.

Think about becoming a microfinancier yourself as you celebrate the holidays and count your blessings.