Last month Kiva began offering loans to entrepreneurs in the United States. I expected an outcry based on opposition to "payday lending," but so far that hasn't been a problem. However:
A group of about 400 Kiva lenders — originally called "Pissed Off Kiva Lenders," but now crusading as "Unhappy Kiva Lenders" — has signed on to a scathing critique on the Kiva site.
"The U.S. is the wealthiest and most resource-full nation in world history," Tom Behan of Seattle, leader of the insurrection, wrote on Kiva's site. "To think that we are asking lenders from around the world to even consider lending in the U.S. is a shameful, disgraceful decision by Kiva management, CEO Matt Flannery in particular."
Behan and others say Kiva has changed its mission. The U.S. borrowers on the site enjoy a higher standard of living than borrowers in the developing world. U.S. borrowers are low-income while many of their developing-world counterparts are no income. The critics worry that loans going to U.S. borrowers will divert money that otherwise would be loaned to the poor in developing countries such as Vietnam, India and Kenya.
Kiva's management is listening:
They are taking a poll on polldaddy.com that shows respondents, by a 5-to-4 ratio, approve of Kiva loans in the United States. And on July 15, they'll hold a worldwide conference call where interested parties can call in and voice their concerns over U.S. lending.From Mike Cassidy at the San Jose Mercury News. TechCrunch has additional coverage. My own impression with Kiva is that there will be little to no crowding out from loans to US entrepreneurs. As it is Kiva is having trouble keeping up with growing demand and I see little reason for this to change. Even as the debacle in credit markets has curtailed lending in other sectors, Kiva has continued to increase its business, although there are some signs that lending is finally slowing. At the end of the day, I think lending to fellow Americans will increase the lending base for Kiva and will increase, rather than limit, loans for other entrepreneurs.