Microcredit is the “new” big thing in charity and economic development. You may have heard about Mohammed Yunus who won the 2006 Nobel Peace Prize for his use of microloans. Now you can get in on the action, too! Kiva.org is a peer-to-peer microfinance gateway that allows individuals to loan money to poor entrepreneurs who are requesting funding to start or expand a business. (Honestly, it reads a little like sponsoring a Sally Struthers child.) You can loan as little as $25 and, when it is paid back, you can either withdraw the money or re-loan it to someone else.
Of course, it is a loan (not a charitable contribution, so no tax write off) and there can be no guarantee you’ll get it back, but it can be a small amount and Kiva’s current repayment rate is over 99.7%. I’m also encouraged by the positive press Kiva is getting. And I have to say, there is something very appealing about the notion of loaning money directly to an individual who is trying to better his/her life and being able to see the results.