April 2008

Kiva.org is the coolest thing in microfinance thanks to endorsements from Oprah and Bill Clinton, but does it really live up to the hype? I don’t think that it does.

The Kiva website claims to have disbursed $29 million USD through 42,645 loans. That seems like a lot, but how does it compare to the world’s most famous Microfinance Institution; Grameen Bank?

Grameen Bank’s website claims disbursed loans of $6.9 billion (Kiva’s is only 0.4% of this) and currently has 7.46 million borrowers.

Kiva’s main contribution to microfinance is to provide funding to microfinance institutions, albeit in a very creative way. It makes individual lenders feel great because the transaction is personified, much in the same way World Vision uses child sponsorship.

But the real problems of microfinance rarely have to do with funding but instead with harder to solve problems such as government policies, finding quality staff and sustainable lending practices. Loan funding is only a small part in improving the outreach of microfinance.

What I’m hoping for is that people won’t think they’ve done enough just by making a Kiva donation, and will instead keep pursuing other ways to make a difference.

When you think about it a Kiva loan is really a very, very small cost to the lender. For example, if you assume a risk free bank deposit interest rate of 5% on a 12 month loan, a loan of $100 is really only a cost $5 in forgone interest (well less, because you’d get taxed on that interest). This is a pretty miserly sum compared to a $100 donation to a tax deductible organisation (which Kiva is not) like Save the Children, if you also contributed your tax deduction it could be considerably more than $100.

Kiva isn’t a bad thing, it’s a very innovative program that’s done wonders to raise awareness of microfinance and global poverty in general. For that is should be congratulated. But what should be clear is the scale of its contribution to the global microfinance sector is minimal despite its high profile. 


I have a friend going on a volunteer assignment to the Philippines.

Here is an excellent video of Filipino prisoners putting on a dance act to Michael Jackon’s Thriller:

And if that’s not enough for you here is an Indian music video interpretation of the same song:

The classic Lao carny game is almost impossible to win, like an real carny game should be. Soft drink and beer bottles are lined up on the ground and contestants are given a shallow container to throw over them. If you completely cover the bottle with the container you win.

One of the funniest stories I heard in Laos was of a friend of a friend’s honeymoon trip to South East Asian.

The trip began with an arrival in Bangkok. A five star hotel was booked for the first night of the honeymoon. When the newlyweds got there they were told there was no record of their booking and as the hotel was fully booked they would have to stay somewhere else. While walking around the streets of Bangkok the bride was mauled by mosquitos. The next day, in paranoia over the prospects of contracting malaria from all those mosquito bites, the couple spent most of the day in the hospital waiting to see a doctor. They were told they were being stupid as you have to wait until you actually have symptoms of malaria being seeking medical care. It’d be like going to the doctor for a cold without any symptoms because you sat next to someone on the train who was coughing a lot.

Their trip in Laos began in Hoeuy Xai, where they caught a boat down to Luang Prabang. This two day boat trip is incredibly uncomfortable from what I’ve been told. The boats are crowded and you end up spending two days sitting on a wooden bench. The couple saw a swollen dead body floating down the Mekong, a real mood killer for a romantic getaway.

There’s a speed boat trip option from Hoeuy Xai to Luang Prabang. Passengers are required to wear a motorcycle helmet (which in Laos is a glorified ice-cream container). I’d recommend staying away from then for safety reasons.

Once at Luang Prabang the couple decided to try a traditional sauna massage. After the massage the spa package left the couple to enjoy a seaweed soak. This really meant being left to wallow in a cold, algae filled bathtub. They started to feel sick and the bride ended up throwing up inside her bath.

Laos will soon be getting trains when the line from Nong Khai in Thailand extends over the border. This will mean direct trains between Vientiane and Bangkok. Maybe in a few years Lao trains will be able to match India’s impressive rail system:

According to an article in The Economist, in 2006 there was a scandal in which millions of dollars in foreign air were gambled on football matches. The transport minister resigned and several officials were arrested.

I’d speculate that they placed losing bets, but imagine if they won? More foreign aid money for everyone.

Even the Thai Prime Minister gets food poisoning in Laos.

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