Comments on: Help Those Less Fortunate — And Make Money — With Microloans

By: Sunday Roundup and Cash Crate Update! | Bible Money Matters

Sunday Roundup and Cash Crate Update! | Bible Money Matters — Mon, 25 Aug 2008 03:46:44 +0000

[...] Support entrepeneurs in developing countries with Kiva @ consumerismcommentary.com: Flexo talks about helping others through Kiva. You can read posts about micro-lending on my blog here and here. [...]

By: Betsy - GreenMicrofinance

Betsy - GreenMicrofinance — Fri, 08 Aug 2008 13:34:45 +0000

Great to see your write up on microfinance. The rate of interest is controversial. MF interest rates are high, but as pointed out, that’s because they must cover the high overhead for Microfinance Institutions managing so many small borrowers’ accounts. Costs are coming down through technology and continually improved management.
That said, in Mexico in particular, highrates for consumer loans are the norm, like around 100%,and this is a sort of bastardized view of microlending. It’s basically mainstream banks making a ton of money lending to low-income people. This is a huge controversy in the microlending world.
Check out the wonderful microfinance organization I work with – our mission is to help finance clean electricity for the “Bottom of the Pyramid”, the 1.8 billion people with no direct access to electricity:
http://www.greenmicrofinance.org

By: A credit card you can use to help others, and get a good rate too! | Bible Money Matters

Fri, 01 Aug 2008 18:26:09 +0000

[...] couple of weeks back we had a guest post on this blog talking about micro-lending. The post talked about how micro-loans through companies [...]

By: Festive Link Love Carnivality #17 | Free From Broke

Festive Link Love Carnivality #17 | Free From Broke — Sun, 13 Jul 2008 11:27:30 +0000

[...] Bible Money Matters – Help Those Less Fortunate With Micro Loans [...]

By: Miranda

Miranda — Fri, 11 Jul 2008 15:34:46 +0000

Thanks for the comments! I do not believe that the loans are secured. And no, you won’t get a very large return. The idea is more helping others, and you get a rather small return — as a bonus.

You will make more going through a p2p site like Prosper, since the return is higher. Microloans for those in poverty are, as I said, just a step up from charity, and the main goal isn’t returns for the lenders.

I’m not saying that 11% – 20% is usurious in all cases. But I think circumstance have a lot to do with it. 11% interest is HUGE to someone in a third-world country, and it severely affects their ability to repay.

By: passivefamilyincome

passivefamilyincome — Wed, 09 Jul 2008 11:47:32 +0000

How does micro lending organizations like Kiva compare with Prosper in regards to secured loans? I like the concept of Kiva but are the loans secured? I know that Prosper loans are not which drives up the return rate. I would be a little more hesitant in loaning money through Kiva if the loans are not secured and you are getting around 7% return. passivefamilyincomes last blog post..Researching Foreclosure Information as a New Income Stream

By: Jason Mitchener

Jason Mitchener — Wed, 09 Jul 2008 04:50:17 +0000

Looking at the sites provided, I couldn’t actually find a way that I would earn interest by microloaning through these organizations. Am I missing something?

By: Llama Money

Llama Money — Tue, 08 Jul 2008 19:21:29 +0000

The idea of microloans is an interesting one… though I don’t think I’ll personally become involved.

I did want to note, or rather ask, what exactly makes 11% interest rates “usurious”? Someone with little / no / poor credit history should pay a higher rate than someone with a long history of good credit. That’s just smart business, not usury. IMHO, anyway.

Llama Moneys last blog post..Stolen Cell Phone makes a mess

By: Kevin

Kevin — Tue, 08 Jul 2008 16:15:19 +0000

Interesting concept! It is cool that you can use your money to earn a return and do some good at the same time. Kevins last blog post..How The Swiss Got Rich: The Zurich Axioms Part 1

By: Aaron Stroud

Aaron Stroud — Tue, 08 Jul 2008 16:08:31 +0000

Thanks for the overview Miranda. Microlending is an exciting development. Providing the poor with access to capital is an essential step in rising out of poverty rapidly. If anyone is interested in reading a more detailed description of microlending, a couple of economists wrote an excellent essay titled The Micromagic of Microcredit. Aaron Strouds last blog post..Who to Listen to and Who to Ignore