How to Use Kiva to Turn Your $50 into $500 as You Infinitely Increase Your Social Impact

Yesterday I suggested that you can be a Banker to the Poor by using Kiva as part of the many good business ideas.

Today I’ll go in a little more depth as to how microlending through Kiva can produce a multiplier effect in regards to your social impact!

You Can Produce a Multiplier Effect of Social Impact

Now with Kiva, the repayment terms vary from 6 months to 1 year or longer.

You can start off with just $25, and loan it off to a microentrepreneur in a developing country. You’ll then receive that $25 again once the entrepreneur has paid you back (after let’s say, 6 months). Then you can re-loan that $25. Then you’ll get re-paid that $25. And you can do it again and again and again.

In practice, the effect of just $25 can be enormous over the long run. And you will definitely see the effect of your $25, because there is accountability, as the entrepreneur is expected to pay it back from the profits that they make.

For instance:
You give a micro-loan of $25 to a woman in Africa. She uses that $25 to buy a chicken. The chicken lays eggs and then she can sell those eggs to people in her community (providing a service to them). She makes a profit, and then repays the loan of $25 (giving you back your $25). The chicken then lays more eggs, and even has baby chickens, and the woman now has a greater scope of increased profit and income-generation for her future.

You then have your $25 again because the first woman repaid her loan. Now you can give your $25 to another woman, maybe perhaps in South America or Asia? It’s your choice. But then again, the process will reoccur.

From a Micro-Loan of $25 to $50..to $500…to an Infinite Amount

Then you decide to give a micro-loan of $25 to a woman in Peru. She uses that $25 to buy a cow. The cow produces milk and then she can sell that milk to people in her community (providing a service to them). She makes a profit, and then repays the loan of $25 (giving you back your $25). The cow then has more milk, and even has baby calves, and the woman now has a greater scope of increased profit and income-generation for her future.

Effectively, you’ve only given $25 once. BUT you have actually given 2 loans worth $25 each. So you’ve made an impact of $50 with just $25. Interesting, isn’t it?

The process goes on and on as you receive your repayments back, and then you reloan the money. That is how you can turn your $25 into $250 or more of impact around the world. It is also how you can turn your $50 into $500 of impact and contribution for the lives of the poor.

In a nutshell: If you give an initial $50 loan with 6 months repayment terms and you re-loan that $50 to another entrepreneur after every 6 months over 5 years, then your $50 will have made an impact of $500.

Check Out the Micro-Entrepreneurs Who I Have Supported

Kiva has made it easy and interactive for you to give micro-loans to small entrepreneurs from around the world. These people already have the initiative and the ideas to lift themselves out of poverty. Kiva is a great way to give to them to give them a boost up on the ladder of development.

  1. Check out their website here: kiva.org
  2. Or even check out my profile to get an idea of how it works: http://www.kiva.org/lender/matthewalberto
  3. Above you can also see all the entrepreneurs who I am supporting or have supported. This is one of the good business ideas that are available today.