Catalyst, Great Stories, Partners, Philanthropy

Kiva is no Island

Kiva.org is one of the best innovations in poverty work I can remember. Taking the impact of microfinance and tying it to the power of the internet for awareness and individual engagement is nothing short of brilliant. Unfortunately, along with the massive exposure have come several misconceptions about how Kiva actually works. On the Social Edge blog a guest post from Kiva fellow Nick Lewis addresses one of the most common errors. In part he writes:

I thought this was worth commentary. Kiva has made significant contributions to the world of microfinance, not the least of which being increased public awareness. Kiva, and the exposure it generates, is what led that caller to even consider microfinance as a development option in the first place–a fantastic turn of events. As Kiva continues to grow and gain increased exposure, however, it’s important to remember that it is only one piece of the puzzle; only one player in a very large game. There are countless organizations utilizing myriad different organizational models and while I’m personally a huge fan of the peer-to-peer connection available through Kiva, there are many innovative organizations out there struggling alongside Kiva to end world poverty.
Kiva does not in fact make loans to poor people. Kiva gathers funds through the internet and distributes them to actual microfinance organizations around the world who have met their qualifying criteria. This information is easily available on the Kiva website but seems to be frequently overlooked. I appreciate the efforts being made to increase understanding for the many people who invest in others through Kiva, and the humility Nick demonstrates in acknowledging that Kiva stands on the shoulders of many predecessors and alongside many alternatives. He also urges readers to become further educated on how microfinance has developed and how it is happening in many distinct models globally. I would encourage interested people to read Billion Bootstraps and the even more recent The Poor Will Be Glad. Catalyst is an enthusiastic partner of Opportunity International and the funder of the innovative MicroMAX initiative.