How to Loan Money to Third World Entrepreneurs
Millions of poor people in Third World countries are getting a chance to start small businesses and build better futures with “microloans” provided by a growing number of non-profit organizations. A microloan is a small loan, usually just a few hundred dollars and with a low interest rate. Now a worldwide movement, microloan-based entrepreneurship is the brainchild of Dr. Muhammad Yumas, who developed the idea in Bangladesh and received the Nobel Peace Prize in 2006 for his work.Today you can do more than just donate money to organizations that fund microloans and other aid programs. Using the Internet, microloan providers like Kiva.org make it possible for you to loan money to an individual entrepreneur of your own choosing. You get to see how the money is used and can even interact with the entrepreneur via the Internet. Traditional donations are important but many people find this a much more satisfactory way to loan money to third world entrepreneurs. The following guide explains how to participate in this exciting new way to help people in developing countries.
- Difficulty:
- Easy
Instructions
-
-
1
Go to the Kiva.org website to register as a member and loan provider. You will need to have a PayPal account to transfer funds. The site is loaded with information so you can learn about the microloan lending program in detail before you begin.
-
2
Click on the “Lend” button at the top of the page. This will take you to the fundraising page listing entrepreneurs seeking loans. Browse the listing, read detailed profiles of each entrepreneur, or sort according to your interest in a particular country or type of business.
-
3
Select the entrepreneur you wish to loan money to and click on the “More” link on their profile description. Enter the amount you wish to lend (the minimum is just $25) in the Make a Loan box and choose Loan Now.
-
4
Continue browsing and choose more entrepreneurs you want to lend to if you wish. When you are done, click Checkout just as you would if you were shopping online.
-
5
Transfer the funds for the entrepreneurs you have selected. If you have not already registered with Kiva.org you will be asked to create an account. You will need to transfer funds for the loans through your PayPal account.
-
6
Track the progress of the loans you have made using the online tools Kiva.org provides. As the loans are repaid you can loan the money again, donate it to Kiva.org to help cover their expenses, or withdraw the money.
-
1
Tips & Warnings
Your chances of getting the money you loan repaid are very high. Kiva.org reports a repayment rate of over 98% which is typical for microloans. Most major microloan providers have similar repayment records.
