The Kiva Fund

[Guest]

.

[Uni.M.Portant]

I propose the creation of a fund for Kiva`s running expenses, by implementing membership payment on Kiva.

Kiva membership:

1.   Why? It is currently free to become a lender. I believe most lenders agree that this is the right strategy to attract new lenders. I would also like to see a free Kiva, but I would also like help and be a part of Kiva. What I mean is that it could be a good idea to allow stronger connection to Kiva than just being a lender. I want to do more. Why not combine these interests?
2.   How?
There are many ways to implement a membership-model. The most basic way is that everyone pays yearly to be a member.  What I vision is an optional, one-time fee for a Kiva membership package.
3.   The fee and the package.
The fee will have to cover the package many times over. This will not be a problem as the content of the package will be more of a symbolic meaning. 10-25$ will go a long way. The package can include many things, but I strongly want mostly non-material things. A status of a co-creator of the fund and something in the area of what I suggested here: http://www.kivafriends.org/index.php?topic=5250.0 is what I have in mind. I am aware of that these, although not being material, also have a cost to implement. The fee should cover this by raising or lowering it accordingly. Another way to make this work is have a basic fee for the membership, and extra for extra. (Like for the Kiva loaner wristband)
4.   Implications
If 10% of all Kivans joined and Kiva has 600.000 lenders, it would amass to 60.000 people. 25 dollars will make 1500000 to insert into the fund. However, only the interests will be used for expenses. 5% interest is 75000 dollars yearly. So the question is: What is realistic and is it worth it? How much money is needed to cover all of Kiva`s expenses? And how much is covered by other means?
5.   Disadvantages
Special status is tricky. It could separate Kivans into two groups; loaners and members.
Efficiency: More to govern?
No possibility to withdraw the money
Are there more?

Is this something worth doing? I could not see any discussions on this topic in my searches. Please let me know what you think!

[Henry]

Is this something worth doing? I could not see any discussions on this topic in my searches. Please let me know what you think!

not for me

[Mona]

Hello Uni.M.Portant,

Thank you for your suggestions. However, I have to agree with Henry that this is also nothing that would be of interest for me. As a European making donations to a US-NGO is unfortunately not tax deductible and I have to bear already the additional Euro to Dollar risk. Therefore I would prefer to use Kiva just for lending.   

Best wishes,
Mona

[wthepoo]

The idea of certain membership "plans" (e.g. for lenders with bigger portfolios, maybe in connection with access to better tools for keeping the portfolio organised) had been discussed before (maybe a year ago) - with some members saying they would consider paying a membership fee and some being more hesitant and preferring the current donation approach).

Your fund solution seems to have one big problem IMHO:
I guess such a fund might result in a decrease in donations as lenders feel they have already made their contribution. And the $75,000 per year you are estimating isn't exactly "much" in comparison with Kiva's annual operating budget somewhere in the vicinity of $5,000,000 to $10,000,000 (it was $5,949,953 in 2008 - see Kiva financials 2008 via Kiva Help Center - and should be considerably more by now). Kiva just isn't the small grassroots/dotcom (or: dotorg)-startup anymore.

Best wishes,
Wolfgang.

[Uni.M.Portant]

I re-read my post and I can certainly see why this is not appealing to anyone. It is relatively little money and for a relatively unappealing thing in return, at least that I managed to show here. I do not buy the tax argument though.

The 75000 dollars yearly are just an estimate, it can certainly be less but also more, probably based on how people welcome the idea.
I see that by saying that they should cover the running expenses, it does not rally people to its cause. People already donate to this anyway, and it will take 20 years to pass the 1.5mill that people originally put into the fund. Still it would be more money in the long term
If it could be doubled or tripled up to 30% of all Kivans, it would be like winning that Sam`s million every 5 years.

So should I abandon this idea? I`ll try to save it first at least. The main challenge is to find something that both is worthy of a fund and that would inspire people to make the one time donation. It needs both to be specific and grand. Running expenses will not trigger this inspiration, nor would simply adding some more stuff on the Kiva page for the donating part of its members. I welcome suggestions very much, but also critique and more fuel to this discussion

[A Nonny Mouse]

Hello, Uni - welcome to KF, and thanks for your thoughtful input. 

Truthfully, the idea of a membership fee repulses me, even though I know continued funds are necessary for Kiva to survive and thrive.  I prefer to donate money on my own terms, selfish as that is.  And the idea of turning Kiva lenders into haves and have-nots, or in this case, 'members' and 'non-members' also leaves me cold.  Everyone contributes as they can, according to their means.  That is part of the power of Kiva.

But I am curious about something you said:

I do not buy the tax argument though.

What do you mean by this?  If Kiva could make it possible for lenders in countries such as Canada, Australia, and Germany (and countless others) to make tax-deductible contributions, this would make much more money available to Kiva.  Your profile states you are from Norway, so you also would benefit from this.  Your statement suggests (at least to me) that you think it is insignificant, and not worth pursuing.  It is possible I do not understand the spirit of what you mean; please elaborate.   


Nonny

[Uni.M.Portant]

I only meant that whether the donation is tax-deductible or not will not decide if someone wants to donate or not. It will of course impact the size of the donation. In other words, it is decisive for Kiva, not for me.

I disagree that it is selfish to donate, even on your own terms

I agree with you on the membership and extra benefits feeling. It cannot go to that. It either has to be its own fund, separate from Kiva and/or have other purposes. I am still in the thinking box, but projects like well-building and other non-lend-able projects are interesing. If Kiva is or want to be expandable in this direction is a different aspect. It could have been fun and interesting to see the "built by Kiva" or something around the world though.

I am very happy for all the input so far, keep it coming.   

[Skimmis]

I propose the creation of a fund for Kiva`s running expenses, by implementing membership payment on Kiva.

Kiva membership:

1.   Why? It is currently free to become a lender. I believe most lenders agree that this is the right strategy to attract new lenders. I would also like to see a free Kiva, but I would also like help and be a part of Kiva. What I mean is that it could be a good idea to allow stronger connection to Kiva than just being a lender. I want to do more. Why not combine these interests?
2.   How?
There are many ways to implement a membership-model. The most basic way is that everyone pays yearly to be a member.  What I vision is an optional, one-time fee for a Kiva membership package.
3.   The fee and the package.
The fee will have to cover the package many times over. This will not be a problem as the content of the package will be more of a symbolic meaning. 10-25$ will go a long way. The package can include many things, but I strongly want mostly non-material things. A status of a co-creator of the fund and something in the area of what I suggested here: http://www.kivafriends.org/index.php?topic=5250.0 is what I have in mind. I am aware of that these, although not being material, also have a cost to implement. The fee should cover this by raising or lowering it accordingly. Another way to make this work is have a basic fee for the membership, and extra for extra. (Like for the Kiva loaner wristband)
4.   Implications
If 10% of all Kivans joined and Kiva has 600.000 lenders, it would amass to 60.000 people. 25 dollars will make 1500000 to insert into the fund. However, only the interests will be used for expenses. 5% interest is 75000 dollars yearly. So the question is: What is realistic and is it worth it? How much money is needed to cover all of Kiva`s expenses? And how much is covered by other means?
5.   Disadvantages
Special status is tricky. It could separate Kivans into two groups; loaners and members.
Efficiency: More to govern?
No possibility to withdraw the money
Are there more?

Is this something worth doing? I could not see any discussions on this topic in my searches. Please let me know what you think!

i dont think Kiva needs this.
All lenders can donate all they want.
Kiva IS already earning interest on the cash flow
A lot of money is NOT relend. Kiva is infact donating those money to kiva after a while.
Kiva IS earning interest on idle money.

What Kiva needs  is help in marketing.

[Mona]

I am sorry to say so but at least for me personally tax-deductibility can decide if I donate or not and not only influence the amount as my money is unfortunately limited.  

If I have the choice to lend or donate to a cause, I lend.
If I have the choice to donate to a cause through a tax-deductible way and a non-tax-deductible way, I choose the tax-deductible one.
If I can only donate to a cause through a non-tax-deductible way I also do so from time to time, but ONLY if it convinces me so much that I abandon my normal reasonable thinking.

There were a few cases when I have done so also on Kiva. One good example is the fundraiser for Florence's school. When currency risk was introduced on Kiva I had e.g. pointed out the idea that people could donate instead into a kind of emergency fund to help out MFIs who have got into trouble through no fault of themselves. And if there were similar things like these in the future I would also donate again.

And now I think we are coming more to the core of why your idea has not spoken to me so far. I would always be happy to donate if I know that I can help with this someone in need. But I would not donate to get additional rights, features or whatever for myself. This is also why I personally do not favor the idea of things on Kiva like competition among lenders, teams, etc. Kiva is for me about THEM (the borrowers) and not US (the lenders).
Well-building etc. is more the direction I would like. A perfect combination would be for me a Kiva borrower or MFI having a great idea that cannot be solved with loans alone (like Florence's school). But as long as we have still so many problems unsolved around the Kiva idea itself (and especially the Kiva homepage with all its imperfect features like the nearly non-existing way of managing big lender portfolios) it would be maybe better to postpone these ideas until Kiva's resources are no longer tied with their main business.

Best wishes,
Mona

[Uni.M.Portant]

Lots of good points in the previous posts. I`ll try to catch them all.

* Kiva needs help with marketing, not others, at least not yet.
* Its not about the helpers/lenders
* You can donate already
* Usage of the fund: Emergency fund or other great ideas not being able to pay back.
* tax-deductible

This fund could be used to a lot of things, the point essentially being that this is "free" money each year. It could even be used for marketing, either directly, but more likely indirectly, by doing good. And this brings me to the second point. The only reason I want this to be for others than the borrowers is that it could spread the word. In other words a kind of marketing. We are the commercial. Not in an extravagant way, or in any other way that focus more on us (the lenders) than on them (the borrowers). The idea is to raise awareness, general knowledge and give perspective on issues that more often than not fall out of general talk.

Yes you can already donate, and yes Kiva is already doing a lot to promote what I just wrote. Keep donating to Kiva. This is something other than Kiva, but still a part of it. This is from us; the members, so donating to this is additional and one-time. And taxes is an aspect that people care about. I do not think that this is what will stop this idea however.

The usage of the fund as an emergency fund is a good idea. Also as a fund to fund those brilliant projects which is unlikely to be able to pay back, is an equally good idea. I see that it is naive to think that this could be done in the near future. It is also apparently against Kiva`s sustainability concept. However it could be argued that projects that run themselves when they are funded, and also help a lot of people, is sustainable in it self and enabling others to do the same.