Kiva is wrong!

[Guest]

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[riverink]

Kiva is a severely rose-tinted view on world poverty.
All these capably-suffering people with their cows without a roof and shops needing an extension.
We (us Kiva lenders) are like social workers only wanting cases with a proven potential for swift improvement, and thus instant gratification for us.

Like everything else in our lives this is just another ME ME ME thing. "Look at me being all super gracious and benevolent, helping all these poor people, aren't I great".
Meanwhile we're conveniently forgetting the thousands dying from dysentery or even malaria.

Actually just dying from those trivial ailments - without a whisper in the news.

So then there's the "supporting the entrepreneurs supports everyone" and "help to self-help" argument.

Well on this I am not sure that our judgement is the best - I think we are drawn towards a nicer view of the world.
Are there any starving kids on your portfolio page?

No?
Well no there is not - because they do not exist in the rosy Kiva world of charity - it's all corn fed farmers wanting more goats to milk and shops that need more shelves - and it gives all us lazy middle class 'eckers something nice to do with an otherwise hopeless Monday night.
To sit here randomly distributing our wealth like some benevolent Buddha - allowing us to forget for a minute that we're stuck in the meat grinder with the rest of the world.

Well I wonder how red cross people watching children die of starvaton feel about my latest donation to Gomez in Paraguay who needs more nuts to sell in his nut shop.

Kiva is YouTube charity for a generation too bored to read newspapers.

[Oriana]

I've noticed that the people involved with this site are not by any means only involved with Kiva. I have found them to be suprisingly aware of many different charities and the like and to be involved heavily with them besides. I haven't seen anyone here say that Kiva addresses the needs of the most desperatly needy and I don't think anyone here is that ignorant. One woman I loaned to gives all her profits from her business to children in need in her community, it bothers me that according to your argument you would extend this me me me mindset label to her. How do you suppose people who aren't currently involved with making a difference in this world are supposed to get involved if people who are so involved don't share that they are and how?

[riverink]

Well I think I am talking about the Kiva concept - not the mindset of every person in it.
I am saying it's a selfish kind of charity because it's different from the normal "just give" kind - which seems so hopeless - because you are trying to help a problem that is bigger than any charity, and so people like us who want to help - end up with these ridicules "portfolios" - as if we'd actually made something -of all the people that we have been kind enough to lend money to.
My point is that we're not even like people buying absolution - we're people tooting our own horn about how great we are because we've decided to give a bit away to charity.
It just smells of hypocrisy. We're not really changing the world, we're just lending money to people slightly worse off than ourselves who look nice in pictures.

[tomgray]

Like everything else in our lives this is just another ME ME ME thing. "Look at me being all super gracious and benevolent, helping all these poor people, aren't I great".
Meanwhile we're conveniently forgetting the thousands dying from dysentery or even malaria.

Naah.  Let's say I have saved a few thousand dollars/euros/whatever.  I have a number of choices about what to do with them.  Most people will invest them, so that their savings grow over time.  Putting a few hundred bucks into Kiva instead, where it helps far poorer people better their lives, is a worthwhile thing to do.

Sure, in the realm of Buddhist philosophy, pretty much EVERYTHING one does is ME ME ME.  So?  A nice Buddhist saying that applies here is, "The giver should be grateful"--presumably, for the opportunity to burn off a little bad karma.

Cut off attachments, become no-minded, let the ego burn away.  Meanwhile, no harm in helping others however you can.

[riverink]

I agree that Kiva does no harm - besides sucking money away from actual charities - and as for for Karma - I'm all for it - but it's between you an your next life.
I don't know if your "Kiva Portfolio" is going to help on that.

[wthepoo]

Well, I don't quite know where to start, apart from thanking you for your first and thought-provoking post - maybe by pointing out that if "everything ... in our lives ... is just another ME ME ME thing", then so is your post and so would be donating the funds to charities. And surely, everybody is able to select the "ME ME ME things" they feel most comfortable with on all kinds of levels, and they don't need to explain their choices. I can say for myself that I do like to do what one member once aptly called "random acts of kindness" even if the borrower of my choice might be less "deserving" than other people, things don't always have to scaled and measured IMHO.

However, I will try to - at least partially - explain why I still think you are wrong - at least from my point of view:

(1) There are - albeit not that many - cases of starving kids on Kiva. For example (and I am sure there are several better ones), one of the first loans I contributed to through Kiva is this one: http://www.kiva.org/lend/53900 where a journal update informs us that the loan has provided the borrower and her family with enough to eat.

(2) More importantly, though, for many if not most Kiva lenders Kiva is only a small part of their charitable activities, so it's not exactly that they don't support clean water, vaccinations, malaria nets, etc. etc. - they do and KF is a testament to that, too. But microloans constitute a great addition and/or alternative to classical donations for several reasons - not only because of their ability to be "recycled" upon repayment so that your funds will last longer and help more people (and can also be withdrawn once it is needed for other purposes - so if you cannot afford to donate considerable amounts because you might need them in some years' time, you can still lend [with care, though]) but also because they truly support a local financial and social system that is important not only for the actual borrowers but for the communities as such.

(3) There is always the case against traditional foreign aid or development co-operation as it is mostly called now - as it has been recently made (among others) by Dambisa Moyo in her book Dead Aid describing and exemplifying the adverse affects of traditional charity.

(4) It is indubitably correct that microloans usually do not (directly) reach the poorest of the poor, probably often not even the relatively very poor - but I think it is safe to say that the "North" cannot financially support all the poor people from the South but that a certain infrastructure and (relative) prosperity is needed in their home countries. Microloans do support just that in a very dignifying way without imposing. That's also why I am perfectly happy to support "more kids going to better schools"!

Finally, I don't think charity (in a broad sense) has to be a depressing affair, and if it makes us smile or feel good (either because of the actual act of lending, because of a particularly moving story, because of a repayment or because of a success story through a journal update), then all the better; isn't that a great side-effect? I don't think, though, you will find many people here quite matching your description of the benevolent and forever generous Buddha with amazing wealth (in my case, the physiognomy might fit, the rest mostly doesn't).

So, everyone to their own - this was just the tip of the iceberg of the case to be made for Kiva, I bet, and I am sure other KFs will show you some of the rest -, and if you have been disappointed / disillusioned by Kiva, I am sorry to learn that, but wish you good choices for your future charitable spending. I will - for now - remain an active Kiva lender.

Best wishes,
Wolfgang.

[riverink]

Like every post on this you say that this is not your only "charitable activity" - so you obviously take my point to some degree.
There are endless numbers of beneficiaries on Kiva and I'm sure you can find some who are in real need - again I am talking about the concept.

Yes it's true that if you lend to people who are relatively well off - they will probably pay you back and then you can pick some more likely debitors for your portfolio and watch it grow endlessly.
Why not open a bank?

Then I note your point that charity does not have to be a depressing affair... do you mean that lending does not have to be depressing - or did I miss something?
The point I'm making is that charity is so depressing, that we've all fled into this nice little Kiva world of smiling peasants - who all love us, loving them, endlessly.

I restate: it's youtube charity - we're bored with the UN and the Red Cross - what do they know?

It's true that traditional charity might not have saved the world - but I doubt that pouring all the goodwill of the Kiva community into spare parts in the congo, or a new barn in Uzbekistan is the answer to those frustrations.

In fact - what it is - is that we have all been sitting on the fat for a good long while - and that is about to change in the next 50 years.
So if you want to help some people in need - start a savings account for your children.

[charity]

I don't think there are many (if any!) people on Kivafriends who would suggest that Kiva is the only answer to ending poverty.  I think we all see it as just one piece of the huge puzzle.  In my case, being involved in Kiva and Kivafriends has helped in my interest in educating myself about ending poverty, and has led me to make many recurring donations to other charities fighting poverty.  Prior to getting involved in Kiva I donated mainly to animal and environmental charities.  Now I donate much more overall, and largely to charities fighting poverty.  I continue to loan on Kiva, in addition to donations, because I think it is doing good -both in literal help to the borrowers, but also in more abstract ways, such as the making a meaningful connection between people of all walks of life all over the world, and helping to educate everyone about poverty and how others live. 

I too have worried that some people (based on their "Why I loan" statements) seem to think loaning on Kiva is instead of donating to other charities.  But I also wonder if people with that sentiment were even giving to charities combatting poverty in the past anyway.  So getting them to loan on Kiva is at least one good thing, and then perhaps some of them will come to learn more about ending poverty as I have, and then also start to donate elsewhere. 

[Jan & John]

Well.  I would say hello riverink, and welcome on your first post as a KivaFriend but you never saw fit to give us your name.
 
I checked your portfolio which shows you have

Stopped lending because:

After reading all your reasoning...
I guess the only thing I can do now is give away all my belongings and go sit in the dirt somewhere and starve along with all the rest of the world.

But somehow the ME ME ME doesn't want to do the Mother Theresa thing. 
I like my comfortable life gifted to me in the birth lottery.

Charity and Wolfgang, thanks for your posts.  I have a feeling everyone could jump in here with reasonable arguments or lists of justifiable good works and none of that would be effective.

I am PROUD of the ways that my loans have been used.
I am PROUD of the young people who devised Kiva and found a way to connect me to the rest of the world.
I am AMAZED by how much more aware and knowledgeable I am about the rest of the world since my introduction to Kiva.
And I am SORRY for you, riverink, that you appear to be looking for magical solutions to the sadness of humanity in general.  Or possibly just looking for someone else to take the blame.

We don't mention religion much here at KF...
but I *promise*, riverink, I will add you to my list of people when I pray tonight.

-jan-

[Diane R]

... you can pick some more likely debitors for your portfolio and watch it grow endlessly.
Why not open a bank?

I have no interest in running a bank; the MFIs with which Kiva partners have already done that, to some degree, so I am happy to provide them with some of my spare funds to enable them to provide capital to folks who otherwise would not have access to it.  Unlike traditional charity contributions, I recognize that my Kiva money will be used in more of a business transaction, and (most of it) will become available for use by others later.  That's very bank-like, but I didn't have to do any of the work to set it up, hurrah!  And oh yes, I don't care about getting any sort of return on my money, which is very un-bank-like, but that's fine by me.

The point I'm making is that charity is so depressing, that we've all fled into this nice little Kiva world of smiling peasants - who all love us, loving them, endlessly.

Speak for yourself, and not for me or others, please.  In what way is charity depressing?  In what way can you prove any of us has "fled" to Kiva?  And just on the surface, many of the "peasants" in Kiva photos are decidedly NOT smiling.  There doesn't have to be mutual love exchanged through these transactions, just a respectful, dignified exchange of funds as someone somewhere works to improve their situation, made possible by a small infusion of capital.

I restate: it's youtube charity - we're bored with the UN and the Red Cross - what do they know?

You've referred to "youtube charity" multiple times in this thread, but I fail to understand what you're trying to say.  I suppose you're trying to be acerbic by saying "we're bored with the UN and the Red Cross": once again, I suggest you speak for yourself, and not for me or others, please.  Some of us support those organizations enthusiastically, while also participating in Kiva lending and supporting a vast array of other charities which speak to us.

It's true that traditional charity might not have saved the world - but I doubt that pouring all the goodwill of the Kiva community into spare parts in the congo, or a new barn in Uzbekistan is the answer to those frustrations.

What frustrations? That we haven't "saved the world" yet by helping working people around the world find access to capital to improve their businesses just a little bit, and in the process improve life for their families just a little bit, and maybe even improve their communities just a little bit?  I don't find that frustrating at all: I find it enabling and respectful, giving someone a chance to work to make his or her situation just a little bit better with dignity, rather than handing them a charity box and being done with it.  

So if you want to help some people in need - start a savings account for your children.

That seems like a rather self-serving statement to me, and assumes that those of us reading your posts haven't done that first, that we may be witlessly pouring our spare cash into feel-good Kiva loans rather than providing for our own families.  I'm thinking that doesn't really merit a serious reply.

I see you've changed your Kiva lender page since earlier today, so your decision to stop lending may be very recent.  Many of us here have our issues with Kiva, its MFI/partners, and some of its directions.  But perhaps you recognize that the community you're speaking to here is not typical of Kiva lenders: there are so many people here contributing their funding, energies, and time to charities and causes as varied as you could name, and I'd venture that not a single one of us is lending through Kiva with the sense that this is all we need to do and the world will get all better right away.  We're none of us that simple-minded, and we're none of us that complacent.  Ending poverty is not something that will happen overnight, and there are many tracks and methods and branches along the path to a better world.  For those of us here, Kiva helps us participate in one of those methods.

--Diane.

[riverink]

My argument (which is not subtle I agree) is about the Kiva concept.
I'm not saying that Kiva isn't helping people, but I'm questioning if Kiva and similar funds/schemes are on balance a force of good.
Also - I'm not attacking this from the outside - been a member for three years, made some 30+ loans with added money for each one.

We can all agree that between the average Kiva benefactor and the average beneficiary something worthwhile happens and I understand the response that Kiva is a community fostering charity... but I think someone has to make the point that this facebook of charity is not really tackling core issues of government,democracy and the rule of law in any consistent way.

This is why our money are better spent with established and experienced organisations like UNESCO and the Red Cross (make ur own list) - who have been in this minefield for decades.

However – this is slow and to be honest abstract - no results this side of christmas – which is why I call charity depressing, and depressing does not sell – so you have to jazz it up a bit with some nice prospects and stories with happy endings.
This has even reflected into some of the established charities who are no longer just helping children - in stead people now have to "foster" a child somewhere suitably horrible, so they can have pictures of little "umdedembengo" on their fridge door to show to people.
People do good for a reason, I know. I recently went to a charitable event and it was filled with single men with their hair all gelled up, all extremely busy doing good.

So let's all get over ourselves and admit that there is some self profiling involved in all this- and then maybe we can start discussing whether this Kiva style "have your picture taken in front of a goat and get some cash" facebook of charity is really the best way to spend money in developing countries.

Again - I am not attacking you or your specific loans - I am questioning the overall effect and saying that this convenience store "charity with a smile on the end" that Kiva offers, will lure people looking to help into a false sense of having done the best they can.

It's wishful thinking - it's much more complex than this.
Surely if you look at your portfolio you can see that it's not exactly world hunger looking back at you?

(Please reply to my full argument and not the odd sentence)

[Oriana]

Instead of focusing on what is negative to you, why don't you rather focus on positive things? There is pretty much always a flaw or more to find in everything, and a depressing angle with which to view everything. I find I'm happier when I just focus on the positive and get busy doing what I can do.

[AccountAbility]

My argument (which is not subtle I agree) is about the Kiva concept.
(Please reply to my full argument and not the odd sentence)

I don't know if you are teachable or not, Riverink, but on the assumption you are I would answer your full argument (which is not subtle) as follows. 

Your premise boils down to simply this.  Kiva is not everything.  So you rant about what it is not.  I don't think you will get much disagreement here.  We KNOW Kiva is not everything.  You don't have to tell us to convince us. 

But here is where we part company.  We believe Kiva IS something.  And that something-- while not everything-- is good.  And much of what Kiva Friends spend energy on is making something good even better.  For many of us, it has also acted as a doorway to other good things that attack poverty and hunger and disease-- which we support more because of our involvement in Kiva.

Dan

[gill]

I think someone has to make the point that this facebook of charity is not really tackling core issues of government,democracy and the rule of law in any consistent way.

Really? It isn't? Kiva is not directly contributing to forming democracy, no. But look at it this way--you have a family in Afghanistan who, thanks to microfinance and Kiva, can now expand their business and keep life a bit more stable. Now they can afford to send their children to school. Those children grow up educated, and are able to get better jobs, which moves them that closer towards being out of poverty...now those children have the opportunity to look around, see what's wrong, try to make their country that much greater...

I smile every time I see a journal where the borrower has been able to send his/her children to school because of their increased profits. You really don't think that Kiva has any impact on poverty when there are children getting enough to eat and access to an education thanks to microfinance?

This is why our money are better spent with established and experienced organisations like UNESCO and the Red Cross (make ur own list) - who have been in this minefield for decades.

Except that the reason so many people are loving Kiva is because of dissatisfaction with those large organizations. Don't get me wrong, I donate to the Red Cross, I think it (and organizations like it) are valuable beyond measure. But I've read so many stories of aid getting held up due to bureaucratic red tape, or donated money going to fund tv ads, or...I donated to Haiti relief, I'm sure 99% of the people on this forum donated to Haiti relief. But I admit, I wonder how much good that money is going to do. In ten years, will that country still be in the desperete condition it's in right now?

I can take a loan from Kiva and say, "this money is going to this person to help her buy a cow, which will help her raise her income, which will help her feed her family". I can know (as much as you can ever 'know' with this sort of thing) that my money is really helping someone, somewhere. Is that selfish, to want that knowledge? And if it's selfish, does it negate the good things the loan money is doing?

So let's all get over ourselves and admit that there is some self profiling involved in all this- and then maybe we can start discussing whether this Kiva style "have your picture taken in front of a goat and get some cash" facebook of charity is really the best way to spend money in developing countries.

What way would you dub the 'best' way? Not trying to be nasty, I'm legitimately curious. Kiva is NOT going to end poverty. It just isn't. But it is going to (it HAS) helped people fight their own way out of poverty, one person at a time. And then those people, who usually aren't the Poorest of the Poor, can go and help those who ARE the poorest of the poor.

For an example, see the mfi update on some Kenyan loans such as this one . This woman can now afford, thanks to microfinance, to help street children (poorest of the poor, yes?) find a job and a new start.

It's wishful thinking - it's much more complex than this.

Sure. Kiva is just one piece of a huge, complex puzzle. I wish it was the end-all-be-all answer to ending poverty, but it isn't. But it helps.

And as an aside...

I, personally, feel that every active loan on the site could default, every mfi could close, every loan could end without a journal update, and Kiva still would have made a difference in the world--because there are loans like this on the site. This one woman's children are in school because of microfinance, when they wouldn't otherwise be. That's just one family out of too many, granted...but it's something, isn't it?

[Mona]

I agree with all that has been written above, especially with Dan's "Kiva is not everything". And I would add that also no other charity is everything. As also not all problems and their solutions are the same.

IMHO there are two basic types of problems that need to be addressed in a different way:

1. The short-term needs. These are the one that are caused e. g. by natural disasters or war and can only be treated with direct help e. g. through the Red Cross and similar organization. If we would not donate food, medicine or other things to people who suffer in these circumstances they would starve or die from illnesses. But this type of help should really only be reserved for emergencies. If you keep people to long on help like this you make them dependent from you and destroy the local economy with cheap or even cost-free food, malaria nets or whatever. If you want to learn more about the disastrous aspects of this type of help, when it is applied wrongly, I can recommend you to read e. g."Dead aid" by Dambisa Moyo (see also http://www.dambisamoyo.com/deadaid.html)

2. The long-term needs. What should happen as soon as the short-term need are filled is that we empower people to end their own hunger themselves. This can be done by helping them to get a decent education, to buy a cow or other things. Why not give e. g. a loan to someone who produces mosquito nets, helping him not only to feed his own children and send them to school, but to also provide job opportunities to his neighbors and saving on the same time his clients from getting malaria? Or you allow someone to buy another cow so that he can save some extra money that could help him to get over the next drought. Or or or. There are many other charities working in this field apart from Kiva. You will find many good examples posted in this forum (see e.g. "News Stories of Possible Interest, or.. Is There Really A World Outside of Kiva?" at http://www.kivafriends.org/index.php/topic,1159.0.html). What I can recommend you in addition is to take a look on the page of The Hunger Project: http://www.thp.org/.

You can now either decide that one of these two is so much more important for you than the other that you decide to focus completely on it. Or you make it - like most/all? of us - and do both, give in emergency cases like the Haiti earthquake to number 1 charities to help feed the immediate needs and stick the rest of the year with number 2 charities to work on resolving the reasons that lead to the number 1 problems, hopefully helping to prevent them from happening in the future.  

[Limesarah]

this facebook of charity is not really tackling core issues of government,democracy and the rule of law in any consistent way.

Kiva itself isn't, no.  But many of the MFIs it partners with do a lot of great work besides just giving people loans.  They run free clinics to educate their borrowers about health care and family planning, focus on female borrowers to empower women in their families and societies, help give people rescued from human trafficking a new start on life and a useful profession, work with borrowers in prisons so that they're not left out to dry once their prison term is up...  the list goes on and on.

I loan money through Kiva and Microplace.  I donate to Heifer International and American Jewish World Service.  I also donate to The Food Project and a couple other local charities, mostly food-related.  All three of those categories serve very different purposes.  Microloans help keep the moderately poor from becoming the very poor.  A loan can serve as a buffer so that a bad harvest becomes a bump in the road rather than the end of someone's farm.  A store owner might be able to expand and employ folks in her community who are less well off than she is.  Perhaps a borrower can now afford to take in his sibling's orphaned children and give them an education, rather than having to see them begging in the streets.  Just because someone isn't starving doesn't mean they don't need help.

[greg3912]

Articles such as this one from today's NYT site are why I personally do not place much faith in traditional charities and food organizations. Of course they do some good, but never expect that most of the money, food or aid actually reaches someone who desperately needs it!

For my money, most of it anyway, I will stick with Kiva.

Half of Food Aid to Somalia Is Diverted, Report Says
By JEFFREY GETTLEMAN and NEIL MacFARQUHAR
Published: March 9, 2010

 As much as half the food aid sent to Somalia is diverted from needy people to a web of corrupt contractors, radical Islamist militants and local United Nations staff, according to a new Security Council report.

The report, which has not yet been made public but was shown to The New York Times, outlines a host of problems so grave that it recommends Secretary General Ban Ki-moon open an independent investigation into the World Food Program there. It suggests that the program rebuild the food distribution system — which serves at least 2.5 million people — from scratch to break what it describes as a corrupt cartel of Somali distributors.

http://www.nytimes.com/2010/03/10/world/africa/10somalia.html?ref=global-home

Greg

[cpbailey]

I look at poverty and wealth as a continuum.  Some are close to the wealthy end, and they don't need help.  Some will be so old, sick, or physically or mentally challenged that they cannot participate in their welfare.  In a poor area, most people fit in neither category.  If we take the people who fit in the middle part of the continuum--probably 60-80% of the population--something can be done to change things for the better.  If the Red Cross and other big, reputable organizations had to take care of the needs of this huge middle part, then it would not be feasible.  So we segment the population; some might do fine with some education/training (Vittana.org and Education Generation); others might need a nest egg to get started (kiva.org); others might need treatment of minor medical issues. Yet, others might benefit by giving families the ability to determine how big their families are.  Let's face it--it is easier to feed and educate two or three children than six or eight.  Also, if medical care is available and affordable, family size goes down.  When children can be expected to survive to support parents in old age, then the need to have many children goes down.

In an emergency, charity is far more important to take things out of crisis mode. 

If a loan to one person, helps a family of five move up a bit to better food security, more health care, and longer education for kids, then this leaves more charity for the folks who might not be able to do so.  I also consider that the use of profits to educate the kids prevents another generation from struggling as much.  Strict aid may not have such a long term affect.

So pick how you want to apportion your donation money.  For me, the repayment aspect means I can give more as I should get it back should I fall down the continuum of wealth and need the money. 

Colette

[granite]

We (us Kiva lenders) are like social workers only wanting cases with a proven potential for swift improvement, and thus instant gratification for us.

As a social worker I do like your analogy as I know all too well you aren't getting anywhere in that profession looking for a quick fix.

Again - I am not attacking you or your specific loans - I am questioning the overall effect and saying that this convenience store "charity with a smile on the end" that Kiva offers, will lure people looking to help into a false sense of having done the best they can.

It's wishful thinking - it's much more complex than this.
Surely if you look at your portfolio you can see that it's not exactly world hunger looking back at you?

I don't disagree.  You certainly make some good points throughout your posts.  I do give some money to charities such as the red cross and others who meet the immediate needs others.  And while Red cross does do some good long term work take a look at what happened in Haiti.  Lots of people donated because they thought to themselves "look at those poor Haitians we have to help them" and then forked over their moeny to red cross or a few dollars at a time to cashiers at checkouts making the plea on behalf of their business.  In many ways this is feeding off the quick fix youtube approach you accused Kiva of.  Don't confuse marketing with what Kiva is actually doing... as quick fix "youtube" marketing does work well for fundraising across the board... this is just not something Kiva is guilty of.  The thought of Kiva is long term... by strengthening the economic power of individuals within a community at a snail's pace you do enhance the social and economic capacity of the community which serves to strengthen it and make it more resilent.  Microloans provide for this and kiva increases the rate at which MFI's can provide microloans.  The impact of kiva will hopefully been seen over the time space 10 -30 years... hardly the stuff of youtube.

I do sense that you are a bit concerned that money is being diverted away from charitible organizations to the mishmash of efforts that is Kiva.  My approach to kiva is that it isn't so much a donation to a charity at all.  A charity is where you give your money away for good to hopefully do good.   I'm not guaranteed my money back, but there is a good chance I'll get most of it back (but I don't count on it).  For me Kiva is a place to park a portion of my money as capital for the various MFI's that are around.  The money I have in Kiva wouldn't be destined for charity if it wasn't in Kiva and would most likely be sitting in a savings account.  I don't depend on Kiva to keep my savings safe (as it is not without risk) but I round up my "investments" to the nearest 25 dollars ever month when I reinvest.  At some point in time I'll likely take the bulk of the money out put it towards something (car, vacation who knows)... but in the meantime I at least know a small portion of my money isn't being used the way my bank sees fit but it being used as capital to strengthen various MFI's out there.  I can't stress this enough... I do keep my own savings for all the things I want to get out of life.   You would be correct if you said kiva isn't the most efficient way to do this... and I will say "I'm guilty as charged" when it's pointed out that for me, choosing my loans is as enjoyable as watching House reruns.  (Just in case there is any confusion: watching House reruns is enjoyable)

Overall your argument is really a good caution... make sure you know what your doing and don't be guilty of over estimating your impact due to your own naivite.  I would challenge people that have a gut negative reaction to what riverink says to take a few steps back and rethink the issues, there is a good point to be made here... although I wouldn't agree that means Kiva is not a good thing... that negative reaction could mean one isn't looking at Kiva objectively.  And perhaps the 5-25 bucks I spend a month to top things up could be better used by some of the charities you suggest... but the reality is the money would never have been destined for there anyways.  Some would make the argument my money is better spent bypassing my savings account and being all sent to charity (I feel this could be the conclusion if we take some of your points to the extreame, riverink).  When you question "if Kiva and similar funds/schemes are on balance a force of good."  You have to ask yourself as compared to what?  If the question is is Kiva on balance a force of good as compared to keeping all my money in a savings account?  My answer would be yes -- but I'm certainly not going to end world hunger, create world peace with Kiva... but I am enhancing the ability of an MFI to provide service to more people which on the balance is usually a good thing.  (Just like donating to a charity... one must cross their fingers the money given to MFI's won't cross the desk of someone corrupt on their way to reaching their target)

[riverink]

Granite: I like your reply and I take the points you make. I think your way of using Kiva is good.

Basically what Kiva does is "help" slightly worse off people in other countries through the always reliable medium of readily available credit.
If you have have your eyes open and realise that's what you're supporting then no problem with me.
You should for example know that the picture of the person you are "lending to" - is taken when they sign the the loan contract obliging them to pay back money with an interest.
The only real information you have to decide whether that was a good idea is whatever sunshine story the MFI provides.
I don't mean to sound overly negative - but take whatever experience you have of human nature an apply it to that. The person(s) in the picture wants the money, and the MFI wants the money.

Another post you might find interesting:http://blogs.cgdev.org/open_book/2009/10/kiva-is-not-quite-what-it-seems.php
I believe Kiva changed their marketing somewhat after this - but not what they do.

What Granite is 100% right in saying is that for somewhere to park your savings, the MFI's are likely to put this to better use than your bank - and I think that's the way to use Kiva.
I also hear and understand the people replying to this saying that this is just a part of their wider approach

I still think that Kiva - having become a significant player in this arena - need to start thinking about their impact on the organisations they compete with.
Kiva's simplified view of world poverty (this happy chap needs more goats) is without doubt more palatable than the real issues of world poverty (this country needs a new government and an educational system), and with the internet and the quickfixit-generation, that means companies like Kiva can keep reporting gains on gains, while other more dull and dreary charities - out in he real world - are having to face a new competitor, and as a result lower the bar on their marketing and start targeting quick win areas.

Your choice is: do you provide finance - or do you finance guidance?

Kiva has a responsibility here - and I don't think they are living up to it.

[AccountAbility]

Another post you might find interesting:http://blogs.cgdev.org/open_book/2009/10/kiva-is-not-quite-what-it-seems.php
I believe Kiva changed their marketing somewhat after this - but not what they do.

Your choice is: do you provide finance - or do you finance guidance?

That blog by David Rodman has been the subject of another thread here--which received a lot of insightful posts, some of which pointing out HIS misunderstandings.  The change on Kiva that resulted from that exchange was to clearly state the timing of the various components of Kiva lenders providing monies to ultimate borrowers.

I would invite you to spend a little time researching Kiva's Field Partners, many of which are non-profit organizations with a broad array of services to help alleviate poverty.  While most of them are not of the size or in the position to directly improve infrastructure or government efficiencies, they nevertheless demonstrate that your "either/or" question many times is answered by "both/and" organizations.  And Kiva's fund has helped these organizations in many different ways.   

A number of Kiva lenders have responded here about how they view Kiva as but one small part of an overall approach to world poverty.  Riverink, you have amply shown that your view of Kiva is fairly negative.  Can you suggest what Kiva could do to move in the right direction?

Dan

[riverink]

No I couldn't - I am not here arguing how Kiva should improve - I'm saying the whole idea is fundamentally flawed.

All the replies go on the line of how Kiva is "only part of a broader approach" or some start listing obvious positives like "if a person with no chance get's a chance it's a good thing" which is true of anything in the universe including a Kiva loan.. but you're still just funding banks - and those banks will bend either which way it takes to keep that money coming.

You ever wonder how come all the Kiva MFI's have such amazingly good deliquency rates?
Because if they don't then they won't get any more cash from Kiva lenders.
You are dealing with businesses who are making money out of lending to people here - but you describe all these MFIs as if they were the second coming - now excuse me for being cynical once again, but when was the last time you saw a bank actually really do some good - apart from some PR stunt to get more people to give them more money so they can make more money.

I am not saying that everything that Kiva does or that any MFI does is bad - I am sure you could list positive stories in their thousands - the point is you have to ask yourself why you can only list positive stories and if you would ever in a blue moon hear about any negative stories from an MFI looking to get more funds.

[waywardcats]

No I couldn't - I am not here arguing how Kiva should improve - I'm saying the whole idea is fundamentally flawed.

All the replies go on the line of how Kiva is "only part of a broader approach" or some start listing obvious positives like "if a person with no chance get's a chance it's a good thing" which is true of anything in the universe including a Kiva loan.. but you're still just funding banks - and those banks will bend either which way it takes to keep that money coming.

You ever wonder how come all the Kiva MFI's have such amazingly good deliquency rates?
Because if they don't then they won't get any more cash from Kiva lenders.
You are dealing with businesses who are making money out of lending to people here - but you describe all these MFIs as if they were the second coming - now excuse me for being cynical once again, but when was the last time you saw a bank actually really do some good - apart from some PR stunt to get more people to give them more money so they can make more money.

I am not saying that everything that Kiva does or that any MFI does is bad - I am sure you could list positive stories in their thousands - the point is you have to ask yourself why you can only list positive stories and if you would ever in a blue moon hear about any negative stories from an MFI looking to get more funds.

There are many points to be responded to here, I will only address this one.

but you're still just funding banks

This is not true.  Microfinance institutions are more than banks, they offer a number of services that banks do not offer because of their target clientele.  Here are just a few examples:

Pro Mujer, Bolivia:  Pro Mujer provides an alternative delivery system for its credit services, the group oriented communal banks which appeals to women traditionally accustomed to working in community groups. Secondly, Pro Mujer offers integrated credit and training services which few other organizations offer.

WAGES, Togo: With the hope of empowering its clients, WAGES offers various training programs. Program topics include: business administration, savings management, credit management, revenue management, marketing, accounting, basic literacy, AIDS and malaria awareness, advocacy, and more.

CCT, Philippines: In addition to CCT, the Center for Community Transformation operates training and development programs, clinics and disaster relief operations. CCT also runs a generic pharmaceutical distribution business called Tindahan Para Sa Bayan which allows micro entrepreneurs to access low cost medicine while funneling any extra income to social service projects.  As a cooperative, its clients are its co-owners and a large portion (70%) of the profits is returned to its client-members in the form of dividends and patronage refunds. 

If you research the Kiva Field Partners available to make loans through, you will find many, many more examples of training programs and services that these MFIs provide to their clients.  You will also see that some are non-profit.  These are not just banks, and their missions and range of services are as varied as the clientele they serve. 

-Kerry-