You want to make a difference. You’ve heard of a microloan, but want to know more before you jump in.
We’ve been so blessed, but others are struggling.
You really feel for these beautiful souls who want more than a handout, who want an opportunity to be independent and reach their potential.
But you don’t have the time commitment for volunteering (even though you’d like to).
My friends, I’m in the same boat. I’m a literal shut-in in the country right now. My health has declined so much I can’t drive past my field, so while I’d love to give more of my time, it’s not the right season.
But I still want to help out. I’ve heard of microloans but didn’t do much digging into it until now. I am really excited about what I’ve found.
the basics of a microloan
I’ve found contributing to a microloan is a great way to help someone who can’t otherwise get a loan from a bank for many reasons, from being in a war-torn country to poverty. I’ve chosen to base this post on KIVA (read more in-depth here), one of the most well-known organizations, but feel free to dig a little deeper to see others that may be a better fit.
Starting as low as $25 (you can give more), via Paypal, your loan is sent to an individual you choose to support. There is a brief description of this person and their needs for the loan, such as tools to expand their business. Others can contribute until the full loan is covered.
What I appreciate the most about KIVA is that the borrowers are expected to pay the loan back. There is potential for a grace period to let the borrower gain some income from their ventures first, so they have the ability to return the loan. If they are unable to pay back the loan after the grace period, your contribution is considered a donation. The borrowers will not be able to apply for another microloan through KIVA.
Once the borrowers do pay back the loan, you have the opportunity to reinvest it in another individual’s dream. What a beautiful cycle!
featuring kiva
The most well-known and established microloan organization is KIVA. It has many accolades and awards, but the system is not perfect yet, and I’m okay with that. I’ve read some articles where the loan you give might go more towards a “group fund” than a particular face, but it still has the same purpose.
For example, I gave a loan to Olivia from the Philippines to buy a fishing net for her business. Sometimes the loan will go directly to Olivia for that particular fishing net. Other times, it might go towards a bigger goal of helping the community with their fishing businesses. The same objective is accomplished, but some people might want their money to go to that particular face.
I don’t feel this hinders my willingness to give. I haven’t been able to find other organizations who can make that real personal connection every time without significant operating costs that would actually take away from the people I want to help.
Even if it may not necessarily be the same face that’s receiving my loan, there is a specific person benefiting directly from what I’ve chosen to support.
Microloans are a great way to give. It has a huge impact from really very little effort on our part (although be warned, it’s hard to choose just one loan, there’s so much need). But it’s more than the old phrase of teaching someone to fish. Microloans let borrowers buy a boat, fishing rod and whatever other tools and training they need to really flourish.
https://www.kiva.org/
engaging the kids:
- Choose as a family your borrower. See what businesses your kids are interested in, and explain a bit more why it’s hard for these people to get started.
- Have your older kids help out financially with the loan! My ten year old needs to put 20% of her allowance into a “give” fund. She can choose where it goes and how much, but this is a great personalized option for her to consider.
read more:
- Want to go a step further and sponsor a child in need? Read more about my favourite sponsorship program, Chalice.
- Able to give a bit more of your time? Here are some great tips for donating items to families in the hospital.
