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Comment by steve19 | Hacker News Reader

The article boils down to

1) Kiva spends to much money on marketing and is therefor inefficient. 2) Kiva gets to much media attention. 3) Kiva are attracting more than their share of micro-investors. 4) Kiva does not export Western cultural values.

Regarding number 4, I think individual investors should decided what and what not to fund. I find cock/dog-fighting to be inhumane, but I enjoy hunting, many people would say hunting is inhumane and immoral and a smaller group would go as far to say "eating meat is murder". What about businesses using malnourished horses to transport goods? Should Kiva not fund anything animal related?

As far as only funding legal organizations. I am sure Kiva does not fund narcotic production or gun running. But how can they possibly be sure all businesses they fund are 100% legal, complying with all health, zoning, retail, licensing etc. laws of the local county/state/country?

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I thought the main gist of the article was that Kiva in the end just doesn't work. The only thing Kiva seems to achieve is to sate our conscience. This concerns me, since I actually did lend a bit of money through Kiva thinking this would really get results.

In the end I'm happy I didn't advertise Kiva to friends and family. I'd have to be 100% sure about the results of any such organisation before recommending it to other people and I guess in the case of Kiva, I never was.

It is interesting to see how readers come away with different gists of this article. I do think that Kiva could be a lot better than it currently is, and other similar companies have addressed some of the issues, only they are not as well-known, perhaps because their PR/marketing is not as effective. See some of the later comments in the Next Billion article when Zidisha is mentioned, for example.

But I think you touch on a CRUCIAL point - it helps our conscience. Phil Mader's original post, which I reference, is well worth reading:

http://governancexborders.com/2013/12/10/kivanomics-101-or-d...

It is a short piece and eye-opening. I cite a phrase from this article in my piece:

Kiva enables us "to consume the feeling of charity without financial loss"

To say that Kiva simply "just doesn't work" is tricky, because we have to define "work". It depends what the objective is. If the idea is to make people feel that they have done something useful with their $25, which they get back a few months later, it works wonderfully. If the idea is to efficiently transfer spare capital in "rich" countries to "poor" countries (forgive the simplification of terms), it doesn't work very well, as there are far more efficient mechanisms. If it is to provide low-cost funding to entrepreneurs, then it has pretty mixed results which are hard to verify as Kiva (mysteriously) don't publish the actual interest rates. In some cases you can find them out though.

In summary, you are very wise to suggest that an endorsement requires you to be convinved that this is a good business. It appears Kiva did not meet your standards, and I am inclined to agree with you.

> If the idea is to make people feel that they have done something useful with their $25, which they get back a few months later, it works wonderfully.

This is a poison on humanity.

I am not sure what to make of this comment - are you suggesting that Kiva is a "poison on humanity" for doing this, or that I am for saying it?! Please clarify! For further reference on this specific point you might find Dr. Phil Mader's post, which I reference, useful:

http://governancexborders.com/2013/12/10/kivanomics-101-or-d...

The actual quote is that Kiva allows us "to consume the feeling of charity without financial loss"

You might also appreciate the work of Domen Bajde referenced in Mader's article.

These are valid points. If I could focus on just one issue of legality, what about insisting that child labor laws are obeyed? I know you could question this on the basis of one person is pro-hunting, another is anti-hunting, so it is subjective. But I think most people are not in favour of child labor. If we could just insist on one law, would this be one that is worth Kiva incorporating? It wouldn't be perfect, monitoring is a problem, definitions of child labor vary from country to country, but perhaps a mild attempt to at least only partner with banks that have a stated policy of obeying local child labor laws with their loans would be a good start? Some microfinance players do have such policies, one of the best is Oikocredit, but in fact many have these policies. Would that be one law that is worth insisting on?

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