16 Responses to “Power to People?”

1. Mogogo says:
   March 27th, 2007 at 6:47 am

   noble idea, but something about it tells me i wouldnt be lining up to invest my cash in there.

2. Sanisha says:
   March 27th, 2007 at 7:44 am

   me too, but then i see from the website that what they are offering is not an investment of your cash in the truest sense, they do not gaurentee anything, let alone returns.Its a loan, you would be financing something that you may not be payed back for, so its a gamble, altruistic gambling.

3. Lincoln says:
   March 27th, 2007 at 11:55 am

   Sanisha, isn’t that what banking is anyway: a form of gambling? You lend money to someone you think will probably pay you back, based on what they tell you. Of course, to make it a livelihood, you normally charge interest, which you don’t do through Kiva. Doesn’t seem like a bad gamble to me. Can I ask why neither you nor Mogogo wouldn’t want to invest your cash that way? Just $25? That’s what, two albums on iTunes?

4. Sanisha says:
   March 27th, 2007 at 12:25 pm

   yeah true that!I mean the only reason I would loan the $25 is because i think it will be put to good use, and not squandered.The gamble I was thinking of, at first, is that there is a risk of corruption ‘at the grass roots’ and etc. I am very distrustful of these schemes but I think that the Grameen Bank story has given microfinance a good name, so yeah I suppose I would use this agency Kiva to funnel money into something good, or rather, I will apply for a loan there and see what happens.I am in the developing world so i will test the waters for you guys…see if its legit.

5. Phillipe says:
   March 27th, 2007 at 7:31 pm

   This does sound pretty interesting, though I also doubt that I would personally contribute anything. I do think that democratizing the microcredit process in the sense of creating a way for ordinary citizens to invest in the betterment of others rather than these huge, largely unaccountable international organizations (I’m thinking of the World Bank) has potential to be a positive thing.

6. nemoDreamer says:
   March 27th, 2007 at 10:13 pm

   I got a nice feeling on seeing all the happy lenders’ faces for this project http://www.kiva.org/app.php?page=businesses&action=about&id=5434, who can now see their money put to good use.
   One thing I noticed, though, is that the site doesn’t really put any emphasis on the RETURN. We’re happy the money’s arrived, but each project-page should keep track of part two as well. Will we see who has payed back their loan? Is it still to early?
   Also a clever feature would be that once you’ve paid back your loan, you can become a sponsor for other projects in your town/circle, kind of like “I know that this person will pay you back, I know him!”.
   Or are we too fixated on getting our money back? Maybe this is just a more direct way of getting your donations to people who will actually use them to create a support-system for themselves?

7. nemoDreamer says:
   March 27th, 2007 at 10:23 pm

   “In the past 30 years, over 100 million of the world’s poor have received a micro-loan and demonstrated a >95% repayment rate.”

8. Sanisha says:
   March 28th, 2007 at 6:39 am

   good points guys, isn’t it great nemoD and Phllipe, that these are all signs of change!?and people collaborating, and uniting.We so often hear bad news that when I hear good news its difficult to take it seriously.

9. Odysseus says:
   March 28th, 2007 at 9:10 am

   Thanks for this interesting article, Lincoln! I’m a bit skeptical, though… Primarily because a programme like this doesn’t involve actively building any local capacity. It assumes that resource transfers are really the answer in development… that poor people in developing countries lack only money. I think that’s wrong. One huge problem faced by the Grameen Bank was that men would often compel their wives to obtain a micro-credit loan, using it for non-investment purposes. Unequal gender relations continue to be a major obstacle to successful lending — and that’s for an organization with a strong local infrastructure. While I think resource transfer is an essential aspect of a new world order, so is building human capacity — I think doing one without the other will ultimately be unsuccessful. But why not try? Some might think it’s better than paying taxes…

10. Lincoln says:
    March 28th, 2007 at 1:25 pm

    Odysseus, what do you consider building capacity? In my mind, developing business skills is one method of building local capacity. I do take your point about these loans not addressing rooted social issues in the local areas, but maybe the loans aren’t for that. Maybe they just address the poverty, which can be people’s overwhelming concern.

    Also wanted to comment on the issue of repayments. I noticed that in the journals section, you can see how much someone has paid back on his or her loan. It would be helpful in that section, I think, to include when they got the loan and how quickly they thought they could pay it back. That would give some basis for judging how well he or she is doing, which I would want to know if I were the lender.

11. Phillipe says:
    March 28th, 2007 at 3:35 pm

    It’s a good point about building the human capacity or what some call “human capital” in a local area being just as important as providing monetary resources. I’d be curious whether any of the micro-lending programs exist as part of more holistic approaches to development that address issues of local culture that may undermine the development process of public health issues that also play a big role. No one intervention can meet every need but it seems that efforts that somehow address multiple factors at once may be more effective in the long term. I do believe that the fact that people have the opportunity to pay back the loans gives an ounce of dignity to the process, a dignity that most people regardless of how poor they may be, desire to preserve if they can.

12. nemoDreamer says:
    March 29th, 2007 at 2:07 am

    Good point, Phillipe: I think that dignity is what makes these micro-financing deals special. This then becomes less of a condescending act by the West.

    I re-read this passage a couple of times, and still don’t get the general meaning: “I’d be curious whether any of the micro-lending programs exist as part of more holistic approaches to development that address issues of local culture that may undermine the development process of public health issues that also play a big role.”
    Is it too late? should I go to bed? Please explain :S

13. Odysseus says:
    March 29th, 2007 at 9:19 am

    While it’s true that loans “address poverty”, we should keep in mind that poverty looks very different in northern Ghana than it does in urban London. Obstacles to investment are not always simply monetary, and it’s foolhardy to think that targeting money is a solution to chronic poverty. What I meant by building capacity is this: if you have an illiterate fisherman who wants to start a small farm, he will benefit from learning basic accounting, a bit about agricultural technology, and market linkages in the closest city. I’ve seen small farms that have benefited from this type of expertise and their success is much greater than those that have not.

    What Philippe may mean is that some micro-credit programmes also involve a family planning and human rights education component.

    Anyway, I think it’s all about how we conceive of development. I’m sympathetic with a definition that involves not only increased access to monetary resources, but possibilities for expanding capabilities and increasing social and economic complexity.

14. Lincoln says:
    March 30th, 2007 at 12:00 am

    a follow-up on the NY Times site from the column that sparked this post.

15. Odysseus says:
    March 30th, 2007 at 8:06 am

    Thanks Lincoln. Unfortunately, my 14-day trial ran out — is there a stable link to the article?

16. Lincoln says:
    March 31st, 2007 at 7:12 am

    I don’t think so, Odysseus. NYTimes want to get their money somehow. Sorry about that.

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