#TEDxMS 2013 : Individuals Changing Lives One Loan at a Time via KIVA

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Delivered at the social enterprise-themed TEDx Merdeka Square 2013 in Kuala Lumpur. One way of facing the problems of global poverty without feeling powerless or guilted is to be part of Kiva's global coordinated experiments in spurring entrepreneurship via crowdlending. This talk argues that not only are each of us able to change a life permanently and directly by lending $25 of spare change to small businesses in low income parts of the world; we can also choose to loan money in Kiva's specific experiments hoping to disrupt the notion of what's possible/practical in non-profit microlending - experiments such as 6 year grace period university tuition loans in Africa, zero-interest Paypal -intermediated loans in US, mobile SMS based lending in Kenya, green in-kind biodigester loans in Mexico, and loans to high-risk conflict zones where startup capital is scarce and needed more than ever to fuel recovery. by former Kiva Fellow Sulin Lau KF20 2013

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#TEDxMS 2013 : Individuals Changing Lives One Loan at a Time via KIVA

  1. 1. 2009-2012
  2. 2. 2009-2012
  3. 3. 2009-2012 35th birthday
  4. 4. For many of us, global poverty feels impossibly large. With half the planet living on less than $3 a day, it's easy to get overwhelmed to the point where we fail to act. It's easy to forget the power that we have as individuals. Premal shah President, Kiva.org
  5. 5. HOW? Part I - individuals changing individuals via Kiva Part 2 - changing the game in entrepreneur funding
  6. 6. Donate and buy my right to go on with my (affluent) day Feel powerless Do something that actually matters.....?
  7. 7. Microloans to creating micropreneurs
  8. 8. Microloans to creating micropreneurs Peer-2-peer lending - idle money becomes capital peer-2-peer micropayments connected global market/ community of willing borrowers and lenders +
  9. 9. Elizabeth Omalla Ugandan widow with 11 dependents Borrowed $500 in ’05 Purchased freezer, fish at wholesale prices
  10. 10. 0 125 250 375 500 1 2 3 4 5 6 7 7 loans in Uganda $3,500 mils cumm loans 461mil 1.1mil entrepreneurs 72 countries 99.98% repayment Small loans $ mil crowdfunded per year
  11. 11. watch live loans at kiva.org/live $1mil lent every 3 days!
  12. 12. 975,394 who lend on KIVA 1.1mil entrepreneurs funded :
  13. 13. Each one of us can directly change 1 life by turning spare change into small biz capital
  14. 14. PART II
  15. 15. kiva as a bigger “catalytic” force .....how about partnering the global crowd to disrupt the way social lending works ?
  16. 16. $ $ $ $ $ $ $ $ $ $
  17. 17. KIVA CAPITAL IS CROWD-FUNDED THUS, UNIQUE FROM OTHER SOURCES DO GOOD, ZERO INTEREST SMALL AMOUNTS $25 HIGH RISK TOLERANCE DIVERSE BASE & LENDING PHILOSOPHIES uniquely placed to test game-changing social innovations
  18. 18. higher edu green/ energy women conflict areas low cost/ scalable technology $
  19. 19. Loans to conflict or post-conflict zones to fund small business recovery
  20. 20. 6-20 year higher education loans http://www.kiva.org/labs/accesstoeducation Rosemary, South Africa The first pilot batch to fund her tuition through a Kiva loan. • Student loans for low income require long terms and grace periods and affordable interest rates • zero credit history • zero collateral • The opportunity cost and risk just too high for normal financial institutions
  21. 21. Green “in-kind” loans (e.g. working with biodigester company, not bank)
  22. 22. zip loan
  23. 23. 26
  24. 24. 27 Kiva Zip uses strangers online to fund entrepreneurs deemed “too risky” for any bank or MFI - and does so at half the cost $0 $0.25 $0.50 $0.75 $1.00 Top 5 U.S. MFI * U.S. MFI avg. ** Kiva Zip Q2 2013 actual Kiva Zip 2013 forecast * Source: MFI Annual Report; ** Source: AEO In just 18 months, Kiva Zip is already more efficient than any U.S. microlender Industry ave $0.42 per $1 Kiva Zip is at $0.25 today costs $0.87 to admin $1 of microloans** Startup < 1 year 1 - 3 years 3 - 5 years > 5 years More than 50% of microloans are to biz < 1 year of borrowers never got a college degree30% to ethnic minorities 55%borrowers live in households earning less than $20k / year64
  25. 25. 28Disrupting the current MFI model - then exporting it 0k 5k 10k 15k 20k 2011 2012 2013 2014 2015 2016 Kiva Zip aims to support more entrepreneurs per year than the entire U.S. micro-finance industry by 2016 Current U.S. microfinance industry (total loan volume est 400+ MFIs) 400MFIs in the U.S. millions ofBut small biz assistance providers Farmer support groups faith based orgs communities & associations public & private individuals who care enough Universities & technical schools Veteran groups Tech Incubators reformed criminal support groups minority, refugee & women assistance groups
  26. 26. Each one of us can directly change lives by turning spare change into small biz capital.
  27. 27. wanna try?
  28. 28. LEND: Kiva.org LEARN: Kiva.org/labs JOIN: kiva.org/team/malaysia VOLUNTEER: Kiva.org/fellows SAY HELLO: hellosulinlau@gmail.com, @sulinlau

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