Kiva does not loan to its borrowers at zero interest. Kiva operates through intermediaries known as field partners (of which ACCION USA is one) who screen clients for Kiva borrowing and facilitate the loan. The loan is disbursed at whatever interest rate the field partner deems appropriate for the particular client (AUSA’s rates range from 8-15 percent). Kiva carefully scrutinizes the operations of a field partner before they approve them, ensuring that they lend ethically and responsibly. To alert lenders to the risk level of lending through a particular partner, Kiva assigns each organization a star rating (visible on their webiste, under the logo of the field partner). When Kiva states that they provide funds at zero interest, they are referring to the money donated from Kiva borrowers that transferred to the field partner with no extra cost. The field partner still charges interest on the disbursed loan to compensate for overhead; borrowers pay but field partners don’t.

Also, as many people have expressed, poverty exists in the United States and financing is not readily accessible to small business owners. In fact, a credit vacuum afflicts the small business lending market; commercial banks aren’t able to turn a profit without charging exorbitant interest because of high overhead, so the only financing option available to many small business owners is credit cards. Microlenders provide an alternative by offering accessible, reasonably priced, and fairly termed installment loans.

If anyone would like to learn more about Kiva’s domestic lending program, I’d recommend an incredibly informative, well written piece on the Kiva blog. For more on ACCION USA, please feel free to visit our website, blog, and follow us on twitter!

Poverty is a cycle that needs to be broken, I see the usual “I got mine, go get yours” stance many umm certain Americans take.

At times the internet is the worst invention ever because people can say whatever they want and not be held accountable. Even if its a lie or a lie they want to believe, they can still say it.

Certain people lie to themselves everyday, another Tim Wise moment brought to you by somebody that Mike Malloy says “Knows You Better Than Yourselves”