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In a time when the availability of credit has rarely been lower there is one segment of business people who seem to be doing rather well. On logging into my www.kiva.org this morning I was slightly surprised to see that there were only four projects that required funding. Kiva is a not for profit organisation that seeks to alleviate poverty through peer to peer lending where entrepreneurs from developing countries can apply for loans. After successive pressing of the refresh (F5) key that number jumped from zero, to two, back down to one and back up to four. Clearly this is an economy where there are more people prepared to lend than entrepreneurs looking for finance.

Kiva is obviously a victim of it’s own success, with supply of entrepreneurs from developing nations being outstripped by generous supporters. It scores on a number of levels for supporters. Firstly the impact Kiva is having is right in front of you on the home page; this week $976k lent by 15,781 supporters to 2,868 projects – supporters are big on visibility. Secondly, supporters have a wide variety of choice and therefore control over where their money goes (unlike most charities). Finally it resonates with the basic human instinct to help others stand on their own two feet.

However any fundraiser must demonstrate that their need is greater than a host of other equally worthy causes in the world. It is important that demand for funding outstrips the supply of funding and that potential supporters are not dissuaded from helping because they see a job already finished.

I can’t begin to comprehend the logistics of finding, vetting and telling the stories of such a rich diversity of entrepreneurs from developing nations – and therefore how difficult it is to rapidly increase the amount of fundable projects in the short term. But, whilst many fundraisers have a definitive goal, and the accomplishment of that goal brings with it a certain redundancy for the cause (curing cancer or ending child abuse), it is vital for Kiva to continue to drive home the message that the job is most certainly not done to both loyal and potential supporters. 

Whilst the international banking system is going through a period of rehab, the peer to peer banking system seems to be in fine health.

Simon James, Planning Director, RAPP UK
simon.james@uk.rapp.com