Chances are, you’ve at least heard of Kiva, the microfinancing nonprofit that allows users to give bite-sized loans to entrepreneurs in poverty-stricken regions. Because people like to feel good by offering cash to worthy causes (or so we’ve heard), Kiva has done exceptionally well, funding $200 million worth of microloans since its launch in 2004. And as of today, you can specifically fund what are, in our opinion, the smartest entrepreneurs–the ones who realize that efficiency is the key to becoming self-sufficient. It’s called Kiva Green Loans.
There are two pieces of the new Green Loans category: lenders can now click on the Green Loans box on Kiva’s “Lend” page to find entrepreneurs who want money for a myriad of efficiency-related efforts (i.e. creating organic fertilizer, buying renewable energy-generating devices, and converting vehicles to run on electricity or biofuels), and Kiva’s field partners--the microfinancing institutions that partner with the site–will be allowed to raise more money on Kiva if they provide loans for energy-efficient technology.
“When we talk to people [about switching to energy-efficient technologies], one of the issues is financing. More people might buy a Prius if the
financing is 0% APR. It’s the same kind of dynamic that plays out with low
income households,” explains Premal Shah, President of Kiva.org.
One of the 60 entrepreneurs that debuted in the Green Loans section today is Andrew Kipsang, a Kenyan businessman who leases Solio solar chargers to members of his rural community. He has been nicknamed “Bwana Stima,” or Mr. Electricity. Another is Maylen Parisan, a Filipina food vendor who wants a solar lantern to cut fuel costs and extend her working hours.
There are a number of reasons why these kinds of loans make sense. “The Internet community is willing to channel money, it’s just more patient, lower-cost, and risk-tolerant capital,” says Shah. “If the Internet funds [Green Loans] quickly, it will send a signal that there is demand to fund
loans in this category which will in turn change behavior around
That’s a good thing–pollutants from dirty fuels (i.e. charcoal and kerosene, which are commonly used indoors) are responsible for killing over a million people each year. On a more selfish note, encouraging entrepreneurs in the developing world to switch to clean fuels cuts down on carbon emissions, which is great news for carbon-hungry nations like the U.S. We can’t afford other countries spewing emissions at the same rate as us.