Was helping to buy a cow the right thing to do?
Last year I lent $25 to a woman in Peru so that she could buy a cow. Cows, of course, cost a lot more than that but I wasn’t the only one contributing—Alex from New York pitched in, as did Ivan from Zagreb, along with 16 other people. None of us have ever met; we all heard about the cow and lent the money through the website Kiva.
Kiva, which is four years old today, bills itself as “the world’s first person-to-person micro-lending website.” In partnership with existing microcredit institutions, it posts profiles of people in the developing world seeking small loans. Anyone can browse the profiles, narrowing them down by country, gender, business sector and so on, and then choose an amount of money to lend. Photos of the borrowers—Kiva calls them all entrepreneurs—give the process a
Rob Fuller
I work in microfinance, and have been uneasy about Kiva for some time.
It’s ironic that you chose to feature Kiva (and in such a simplistic, face-value way) in the very week that their misleading marketing practices were being debated in the blogosphere. The CEO of Kiva accepted that they had been less than open with people about how donations are used (http://blogs.cgdev.org/open_book/2009/10/matt-flannery-kiva-ceo-and-co-founder-replies.php). Kiva subsequently changed their website to give a more honest description of what they do with your money (http://blogs.cgdev.org/open_book/2009/10/kiva-revamps-how-it-explains-itself-to-users.php). Unfortunately for your anecdote, it’s very unlikely that your $25 went to that particular woman in Peru.
Here is a summary of the whole controversy: http://www.philanthropyaction.com/nc/a_mostly_comprehensive_guide_to_the_kiva_and_donor_illusion_debate/
And here is a nice summary of why fundraisers use tricks like this: http://blog.givewell.net/?p=440 Essentially it’s because people are more likely to donate if they think they are giving to a specific individual – and they’re also more likely to write sympathetic articles in magazines like Prospect.
Mamie
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