Why I’m Investing In A Beans Business In Togo And A Sandwiches Business In Paraguay

I knew Togo was a country in Africa, but to be honest I had to look it up on a map to discover that it’s a thin slip of a country squashed inbetween Ghana, Bukina Faso and Benin. My new found interest in the country stems from the fact that I’ve just invested in a business there that sells cooked beans in the coastal town of Anàcho. Together with over two dozen individuals from all over the world, we lent the owner, Akouvi Dovi, US$825 to buy beans, oil and flour to help the business grow.

Last month I invested in another catering business, this time lending money to entrepreneur Luis Jara who lives in Paraguay and who runs a food stall selling a type of sandwich called a lomito.

Every month I’ll be doing the same, investing US$25 in a business enterprise in a developing country that I’ll probably never visit, and to entrepreneurs who I’ll probably never meet. I’m able to do this thanks to the website Kiva that allows you to join others in making loans that really do change lives all over the world.

Kiva is the world’s first person-to-person micro-lending website, making it possible for the likes of you and me to lend directly to fellow entrepreneurs around the globe. This week alone nearly four thousand entrepreneurs have been lent money in developing countries thanks to Kiva members.

The loans are repaid over a period of time, with repayment details and other updates posted on Kiva and emailed to lenders. Repaid money can then be lent again to another entrepreneur or withdrawn. What I like about Kiva is that the money you lend goes directly to someone who is actively trying to improves their lioves, the lives of their family and often that of their community too, by their own enterprise.

What if the borrowers don’t make a repayment? Well, life happens and it’s inevitable that there will be defaults for many reasons, but what’s the worst that can happen? You lose your US$25? And it’s worth noting that of the US$31 million worth of loans made to date, the default rate on repayments is just 1.8%.

My motivation doesn’t come from seeing the loan repaid anyway, but in knowing that I’m helping a fellow entrepreneur in parts of the world where life is much harder than it will ever be for me, credit crunch or no credit crunch.

So if you’ve got US$25 languishing in your Paypal account, take a look at the Kiva website to see whose life you could be changing today.