Kiva in the US?

[Guest]

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[lizzielu]

Are there any plans to bring Kiva to the US? Example: there's a nice man from Eritrea (eastern Africa) who works in the parking garage in downtown Portland, Maine (where I live). As a refugee to the US, I can't imagine him being able to get the funds to get out of that little booth and start a business. Are US banks open to micro-lending?

[KivanSteven]

Funny you should ask, and welcome to the forum....I just read an online article, cant remember what linked me to it, but the most popular microfinance org within the US, is called Accion USA.

http://www.accionusa.org/site/c.lvKVL9MUIsG/b.1359227/k.F8F8/Small_Business_Loans__Microlending__Business_Loan.htm

Up until 2005 they only worked in select cities, but now serve most of the United States.

As for Kiva offering loans to Americans Im not sure that will materialize because the standard of living is so very high.  Even if only 100 people needed loans of $10k each for business purposes, thats still one million dollars, just for 100 people, while Kiva in working around the rest of the world, has funded over 17000 loans with just over 11 million dollars as Im sure you know, so you can see the difference in numbers.  Funds go so much further in developing countries.

There is a Kiva similar site called Prosper.com, where people loan to one another.

Great to have you and please do speak your mind.  This is an incredible forum.

[RichardF]

Hi lizzielu,

Welcome to Kiva Friends.  Whenever I notice a conversation with someone who might not know about Prosper.com, I have to butt in.  I am a former, disgruntled Prosper lender.  Prosper is a very high risk platform for individual lenders.  Many people have lost thousands of dollars when they were led to believe they would make a killing lending to high-risk U.S. borrowers.  It won't happen.

Check out How to Turn a Pipe Dream into a Nightmare.

[KivanSteven]

Thats true Richard.  I am not a huge fan of prosper either though the concept is awesome.  I should have clarified that I wasnt suggesting she get involved in the site, but more so was trying to let her know what was out there for Americans that was as close to being Kivaesque as possible, but thanks for pointing out the risks of prosper.  Also you are usually dealing with a lot more money on prosper than on Kiva.  On prosper you earn money through interest, so are encouraged to loan more, and obviously the more you loan to a few individuals, the higher the risk...just as it would be with Kiva if you funded whole loans by yourself, which is why its smart to always spread out the people to whom you make loans to.  Thats also what makes Kiva fun and fulfilling now that I think about it for the 100th time.  If you choose to loan on a consistent basis you become involved, directly, in the lives of numerous people around the world, rather than just one or maybe a few.  So loan less (smaller amounts) to more people, while enjoying Kiva more and enduring less risk for yourself.

[RichardF]

Steve,

I understand you're familiar with Prosper, I just have to put up the cautionary tale when it's not there.  The minimum loan at Prosper is $50, so that's really not too much of a difference on distributing your risk or personal contacts.  The difference is the astronomical default rates at Prosper and how Prosper attempts to mislead its lenders.

Anyone remotely considering lending at Prosper should read these two forums for at least a month before lending any money.  Assuming you don't lose everything to defaults, it will take three years to get any one loan's money back.

• Official Prosper Forums
  
  • Prosper Discussion Forums - Late loan statistics, Yuck!
• Unofficial Prosper Forums - registration required
  

[cpbailey]

Kiva has a $2000 limit for a loan.  This would not make a significant difference to a small business.  In the U.S. there are many forms of capital available--banks, credit cards, home equity loans, small business loans and so on.  There are programs thru, I believe, the Small Business Administration.

To scale loans for a business in the U.S., it would be a LOT more money than $2000. 

Colette

[KivanSteven]

Oh Richard, I guess I dont know about Prosper as much as I thought.  I didnt know there was a $50 minimum, I thought you loaned entirely to one person here, and one person there and chose your interest rates.  I was on it during its very early days, maybe things had changed or I misunderstood something the few times I viewed the site, but I didnt spend much time with it.  Thanks for clarifying things for me as well.

[RichardF]

"Prosper - the eBay of P2P lending," or something like that.