Microlending

Through the microfinance organization Kiva, I have made several loans to small businesses around the world, including in Kenya. These loans link me to these businesses, through good and bad times. And Kenya is definitely seeing bad times. Now I really have not been paying as much attention to the contested election and the riots in Kenya as I would have liked to, but they affect me through these loans.

The Ebony Foundation is a partner of Kiva that works in Kenya. Here is a report from the Ebony Foundation on what is happening in Kenya:

I wish to thank you for your continued concern and support during this very difficult moment in Kenya・s history. We have been a peaceful Country in a generally troubled region and people sort of took the peace for granted.

The country is now battered almost to a pulp and blood spilt with
vengeance, senseless killings and wanton destruction. Markets, food
stores and shops have been looted. Hospitals are dysfunctional and
health centers incapacitated by riots and barricades. The violence,
death and destruction witnessed in the Country for the last couple
weeks has jolted the Nation into conscience and every body is now
craving normalcy.

While peace is slowly returning to all affected parts of the Country,
the impact of the riots has been devastating. Hundreds of people have
been killed turning thousands of innocent children into helpless

Awhile ago I introduced the organization KIVA microlending to Culture Kitchen. KIVA a microlending agency that connects small businesses with small investors like you and me. KIVA works with local partner organizations to find businesses around the world that look promising and want loans to expand. Loans can be a few hundred dollars all the way up to a couple of thousand dollars. Investors like me can put as little as $25 into the pot and KIVA combines these small amounts of money until the loan is filled. They then disburse the money through their partner organizations and keep track as the business pays back the loan. When the loan is paid back you can either take back your money (you get no interest) or you can reloan to another business.

I started loaning to businesses through KIVA over a year ago. And I have felt like my loans have really made a difference to families around the world. I want to share with you one of the amazing success stories I have been a part of and I hope that it will inspire you to participate in KIVA's efforts.

Lakev Groceries is a small shop in Eregi, Kenya owned by Petronilla Shivachi, nicknamed "Betty" by her customers. Eregi is in Southwestern Kenya near the Kakamega forest. This forest is the last virgin rainforest left in Kenya and is part of the Lake Victoria catchment basin. This whole area's environment is endangered because of the drying up of the African lakes region. I should add that any success story in Eastern Africa is also endangered by the drying up of the African lakes region and the East African environment. As an aside to this diary I should add that the East African environment and economy depends on preserving these lakes and forests. To this end I always recommend people join me in supporting environmental efforts like those in the Albertine Rift Valley area and in the Kenya itself. And, since these lakes are bordered also by Uganda, preserving the environment in Uganda can also help the entire region. Again, the entire success story I am about to describe could be ruined by the environmental degradation of the East African Lakes region.

This is a message from a woman's coopertaive in Senegal that I have leant money to through the organization KIVA:

“We’ve taken many loans from other organizations, but we haven’t been able to save much because of the high interest rates and savings deposits that those loans required. This time is different, and I think that we’re going to make a good profit. SEM is the best lender of all.”

SEM is one of Kiva's many partner organizations that manage Kiva's microloans locally. Here is some background Kiva gives regarding its loans in Senegal:

Senegal is one of the world’s poorest countries, yet its solid democratic tradition and highly developed associational life distinguish it from other countries in its income group. Especially remarkable are Senegal’s networks of rotating savings and credit associations, known as tontines. Commonly organized by groups of twenty to thirty housewives who live in the same village, the tontines provide poor women throughout the country with small loans to finance modest income-generating activities. Repayment rates within these associations are excellent, because they are based on local reputation and personal trust between the members. However, their financial resources are limited to the contributions of their members, frequently subsistence farmers with very little disposable income. This has prevented the traditional tontines from meeting the demand for rural microenterprise loans and restricted their impact on the economic development of their communities. Senegal Ecovillage Microfinance (SEM) works with our partner organization CRESP to bridge this gap by linking traditional village credit associations with outside sources of finance.