Last September, I introduced you to Kiva, the world’s first person-to-person micro-lending initiative in a post where I posed the question Can Micro-Finance Make a Macro-Difference? after being referred to the site by a fellow hoser.

In an attempt to answer that question, I decided to conduct an experiment. Since last July, I have been making a minimum of two loans a month under the hypothesis that if it works, after a year I will have enough capital in the Kiva system to help at least one new person every month as previous micro-loans get re-payed. To date, the doctor has made thirty-six $25 Kiva micro-loans (which get bundled with other micro-loans to fund loans to individuals and groups through Kiva’s micro-finance partners). Of these, 14 have been repaid in full and 17 have been partially repaid. In other words, Kiva is still working great and accomplishing its goal of making loans that change lives.

If you haven’t tried it out yet, why not give it a shot? Now it is true that lending to the working poor through Kiva involves risk of principal loss, as the site is careful to disclaim on every page, but over 90% of 99 active (& pilot) field partners have a 0% default rate (and none of its current active partners have a default rate of over 1%). It’s still less risky than investing in the stock market and mortgage funds. (As you can expect that over 99% of your principal will be returned to you, on average. How many of you can say that about your current investment portfolio?)

Furthermore, it now allows you to lend to small businesses in North America, including small businesses in the US! This means that you can now support your local business in a new way! So if you’re still lucky enough to have any discretionary funds left, why not take part of them and try lending through the Kiva platform? Considering that you can start for $25, or the cost of one good bottle of wine, it’s an endeavor that the vast majority of us should be able to afford. And if you do lend, remember to tell them that jeff <at> hosernews <dot> ca sent you (because one should give credit where credit is due). (And if you’re a fellow hoser, you can even consider joining his team.)

Finally, remember the inherent supply chain lesson. If a good supplier is in trouble in these hard financial times, key customers can band together to keep it financially solvent until times improve through faster payments, guaranteed orders, and low-interest loans. And, in addition to the good feeling these customers will get from knowing they did right, they can also secure long-term capacity from a strategic supplier. Let’s face it — most business people want to do the right thing when given the choice, and many will be quite happy to sign a long term contract or guarantee if you help to bail them out. This means that if you stick by a good supplier when it’s having a bad day, it’ll stick by you through thick and thin.

The following are the loans that the doctor has made since last July and their current status.

^*As of Nov 2, 2009