Kiva 2.0: I'm On A Lending Rampage

The other day I wrote about the changes to loan repayments over at Kiva.org. Flush with partially redeemed funds, and now knowing that I will not have to wait for any particular loan to fully mature before being able to make another, I went on a lending rampage the other night.

Following on the plan I detailed - to begin loaning out money not just to Mexican entrepreneurs, but to businesspeople living in places and cultures that represent security interests of the U.S. - I selected entrepreneurs in Pakistan, Tajikistan, and Azerbaijan. At this time, there are still no loan applicants from Mexican entrepreneurs, so I held back $25 of my available funds while waiting for some to appear. The total loans funded in my portfolio (gathering funds, paying back, and redeemed) jumped to 19 because of this. That means I've now funded $475 U.S. dollars worth of loans with just $200 on deposit.

The first, is the Shagufta Ehsan Ilahi Group, a group of women in Pakistan who have entered into a "mutual guarantee" agreement with each other and their lender to secure their loan (if any one of them cannot pay for some reason, the others pick up that person's share of the loan). The women have different reasons for seeking these funds, but three of the five are looking to break into milk production. In my microlending, I like looking for applicants who seek to produce a good, not just act as middlemen for the products of others.

The second loan went to Davron Gulyamov, an animal trader in Tajikistan. Having just said that I prefer lending to producers rather than middlemen... well, here's a middleman! I decided to lend to Davron because of his experience in this business - 14 years. One would think that in that much time a person could learn a trade well enough to be an expert, so despite my preference for production, I think Mr. Gulyamov will handle this capital well.

Finally, a man by the name of Azer Abdullayev of Azerbaijan, who is a sheep breeder and a butcher. Azer raises sheep for slaughter (apparently mutton is popular in Azerbaijan) and has reached a point where he needs to expand his flock by 20 sheep to keep up with demand. A popular consumable product produced by Mr. Abdullayev himself... slam dunk.

As I said, in addition to looking for certain types of business, I'm also looking at where they are. I chose the Pakistani entrepreneurs because, despite Pakistan being a U.S. ally in the war on terror, many in Pakistan regard the U.S. with suspicion and hostility. The borrowers of these funds are told where they are coming from, so they will know it was U.S. citizens (as well as people in other places, primarily Western) who are helping them.

Tajikistan and Azerbaijan share in this aspect somewhat, too, in that they both have large Muslim populations who may have a low opinion of us. But my interest in them has more to do with their shared history: they were both once captive subjects of the Soviet Union. As I said in my last post about Kiva, I think, given Russia's recent aggression against its smaller, weaker neighbor, Georgia, that former Russian states are going to need help building strength to guard against them being swallowed up by a resurgent Russian bear. Microlending directed at spurring commerce in these former Soviet countries could help them to achieve that strength, not to mention make us a few more friends around the globe.

I'm really liking the changes Kiva has made to their handling of repayments. I was able to do all of this in very little time thanks to those changes, and I expect I'll be able to do more in the future. If you haven't checked out Kiva before, I encourage you to do so.