The Power of Soft Capital
Friday, March 27, 2009
In 2004 two Americans, Matt and Jessica Flannery, returned home from a research trip in East Africa gobsmacked by the resourcefulness and entrepreneurship capacities displayed by the poor in the rural areas they had visited.
The Flannerys discovered, much to their surprise, that being poor didn’t double for being helpless and, more importantly, how far small loans of about $100 could go in facilitating and encouraging further resourcefulness of small businesses in the fight against poverty.
Of course, micro-finance is not like buying a coke, so the Flannerys galvanised an ambitious plan that would promote sustainable development through linking small businesses in rural Africa to potential money lenders in the developed world.
Before long, Kiva was born as the first citizen-powered micro-finance scheme; lenders and entrepreneurs were featured from all over the world, taking the rock out of Bono’s Liveaid and GCAP poverty alleviation efforts, and making concerts and white band awareness campaigns to cancel debt, increase aid and grow more trees in the developing world campaigns seem like schmaltzy fetishes of the bored.
Without the glam of Hollywood endorsement, Kiva has been quietly connecting ordinary concerned citizens to aspirant entrepreneurs in the Third World needing start-up or pimp-up cash for their business.
“The idea of Kiva is rooted in democratising microfinance; the average person with just $25 can assist an entrepenuer and have the level of information regarding where that money goes,” said Fiona Ramsey, director of Kiva’s public relations.
Visiting Kiva online is akin to entering a sort of bio-social networking site; instead of selecting a mail-order bride, adding a Facebook friend or discussing a new gadget with a like-minded enthusiast in a geeky tech forum, Kiva allows the “socially minded” to browse profiles, journals and select exactly whom you want to assist almost anywhere around the globe.
“Part of our vision and our philosophy as Kiva is to focus on the language. So this means instead of painting a picture of what people expect poverty to look like, we focus on things like family, business and vocation,” said Ramsey.