DIY Foreign Aid

You, Too, Can Be a Banker to the Poor

For those readers who ask me what they can do to help fight poverty, one option is to sit down at your computer and become a microfinancier.

That’s what I did recently. From my laptop in New York, I lent $25 each to the owner of a TV repair shop in Afghanistan, a baker in Afghanistan, and a single mother running a clothing shop in the Dominican Republic. I did this through www.kiva.org, a Web site that provides information about entrepreneurs in poor countries — their photos, loan proposals and credit history — and allows people to make direct loans to them.
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Web sites like Kiva are useful partly because they connect the donor directly to the beneficiary, without going through a bureaucratic and expensive layer of aid groups in between. Another terrific Web site in this area is www.globalgiving.com, which connects donors to would-be recipients. The main difference is that GlobalGiving is for donations, while Kiva is for loans.

A young American couple, Matthew and Jessica Flannery, founded Kiva after they worked in Africa and realized that a major impediment to economic development was the unavailability of credit at any reasonable cost.

“I believe the real solutions to poverty alleviation hinge on bringing capitalism and business to areas where there wasn’t business or where it wasn’t efficient,” Mr. Flannery said. He added: “This doesn’t have to be charity. You can partner with someone who’s halfway around the world.”