How To Give And Get In Return
Charity is about giving without expectation of return, but investing is about expecting a return on your spent money. These days, you don’t have to choose between being an open-hearted philanthropists or a hard-nosed investor, you can do it both at one time. There are now organizations that help you fund microloans to individuals to help them succeed in their ventures, whether financial or social, with an expectation of a return on that investment in the form of interest. You can invest in social projects of merit, and make money too.
Kiva.org
Kiva.org is a very well-known site that will match investors or donors with people looking to finance commercial projects in other poor countries. You can go online and read the profiles of the people looking for funds. You don’t have to fund the entire project, you only have to contribute $25. The entire project is funded by a net aggregate of lenders who eventually make up the entire loan, which can be as little as $100. In exchange, you will see a return on your investment through a repayment of the microloan and a subsequent increase in social capital in the area you’ve chosen to invest. Once repaid, you have the choice to withdraw the funds back to your PayPal account, donate it to Kiva.org, or continue to fund more microloans.
This site isn’t about charity, although it can be about doing some social good. It all depends on who is asking to be funded and why. The site allows you to provide loans to individuals who have particular goals in mind. They will show you their creditworthiness and give you an idea of how much interest you can expect to earn on the investment. You can earn far more here than in a regular bank account, but the risks can be higher too. People can default on the loans, although if you spread out your loans over many borrowers, you reduce the risk significantly. If your goal is to help get a family out of credit card debt, by lowering their interest from 30% to 10%, you can feel good about helping others and still make a good return on your investment too.
This entry was posted on Friday, November 27th, 2009 at 11:50 am and is filed under Investing. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.
