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Originally posted by Miss Pie I really just don't like your attitude.

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Originally posted by Penalba My personal qualifications are not relevant but since you ask, I have a B.A in accounting and also am in the business of lending money. Obviously they DO charge SOME interest. Even as a non profit they do need to charge a little higher than bank rates as the risk is higher and to account for bad debt. That would be okay, but I suspect that they are charging higher than that as they do not clearly disclose their interest rates. Furthermore, I run business in South America and am an American Citizen. As much faith as you have in the American Accounting system and Laws, trust me, there is no way for them to check up on that as these loans are all cash and most of the time there is no real way of proving how much you charge and how much you receive. Especially in micro financing when there are so many loans of such small value.

Here it is:

http://na3.salesforce.com/_ui/selfs...50150000000Rdbb

The interest being charged for each loan is found under the title, "Portfolio Yield" if you scroll down a little on an individual loan profile.

example: http://www.kiva.org/lend/263118

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Kiva uses a calculation called “Portfolio Yield” to express the average interest rate and fees that Kiva borrowers pay to the Kiva Field Partner administering their loan. Portfolio Yield is defined as all interest and fees paid by borrowers to the Field Partner divided by the average portfolio outstanding during any given year. The Portfolio Yield is generally based on audited financial information and is a better indication of the cost of borrowing money from a Kiva Field Partner than the simple interest rates reported by our Field Partners because it: a) Includes any fees associated with loans and b) Is expressed in one-year increments (similar to the way an APR works) Please note that Portfolio Yield does not yet include the concept of mandatory savings.

EDIT: Oh, and I worked for a 501(c)3 for 3 years.

___________________

Now with extra singles!
my old stuff, not quite up to snuff - but I still dig it - UPDATED 9/23/2012

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Originally posted by EddieZilker Here it is: http://na3.salesforce.com/_ui/selfs...50150000000Rdbb The interest being charged for each loan is found under the title, "Portfolio Yield" if you scroll down a little on an individual loan profile. example: http://www.kiva.org/lend/263118 EDIT: Oh, and I worked for a 501(c)3 for 3 years.

I couldn't find how you got to "portfolio yield page" but I saw the example you copied. 21% is actually a very reasonable interest rate. I'm surprised the profitability (0.9%) is so low but I suppose it can be conceivable. Although salary pay offs is considered a business expense, isn't it?

As ms pie pointed out, I am still by nature a cynical person, which is why I am not totally convinced. But at least you have proved that they DO in fact disclose individual interest rates which makes this entirely more credible than I previously thought.

Finally, as I said before your personal qualifications are not relevant on the internet buddy, but your facts are, and in this case, you made your point.

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Originally posted by Penalba I couldn't find how you got to "portfolio yield page" but I saw the example you copied. 21% is actually a very reasonable interest rate. I'm surprised the profitability (0.9%) is so low but I suppose it can be conceivable. Although salary pay offs is considered a business expense, isn't it? As ms pie pointed out, I am still by nature a cynical person, which is why I am not totally convinced. But at least you have proved that they DO in fact disclose individual interest rates which makes this entirely more credible than I previously thought. Finally, as I said before your personal qualifications are not relevant on the internet buddy, but your facts are, and in this case, you made your point.

The example I put up is relatively low and I clicked on another that was 36+% - in the interest of full disclosure.


The reason I'm putting up my "qualifications" is because my experience is relevant to the discussion. The accounting has to be very precise. There really isn't a lot of tolerance that would allow one to hide anything beyond the permitted reserve and when the auditor shows up he looks at all the accounting in the GL and performs an incremental audit of all paperwork relating to transactions. Additionally, everything which belongs to the company, up to and including office furniture, computer monitors, et al, has an asset tag which is scanned each year. I'm not saying it's impossible and I've seen, elsewhere, some sloppily run 501(c)3's (missing asset tags, loose Expense Report and receipt policies), but they're very atypical.

___________________

Now with extra singles!
my old stuff, not quite up to snuff - but I still dig it - UPDATED 9/23/2012

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Originally posted by EddieZilker The example I put up is relatively low and I clicked on another that was 36+% - in the interest of full disclosure. The reason I'm putting up my "qualifications" is because my experience is relevant to the discussion. The accounting has to be very precise. There really isn't a lot of tolerance that would allow one to hide anything beyond the permitted reserve and when the auditor shows up he looks at all the accounting in the GL and performs an incremental audit of all paperwork relating to transactions. Additionally, everything which belongs to the company, up to and including office furniture, computer monitors, et al, has an asset tag which is scanned each year. I'm not saying it's impossible and I've seen, elsewhere, some sloppily run 501(c)3's (missing asset tags, loose Expense Report and receipt policies), but they're very atypical.

Yes but do you think all of this applies to American owned business operating in 3rd world countries? The ideal answer would be yes. But I highly doubt it. Again - cynical.

Edit: *SMALL* American Businesses operating in third world countries.

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Originally posted by Penalba Yes but do you think all of this applies to American owned business operating in 3rd world countries? The ideal answer would be yes. But I highly doubt it. Again - cynical.

True. We're talking about an ideal world. There was a recent article which pointed out that a lot of charities carried executive top-heavy financial loads and the money being donated wasn't going to assist those who the charity was purporting to help so your cynicism is justified. Still, this Kiva seems to be on the up-and-up.

___________________

Now with extra singles!
my old stuff, not quite up to snuff - but I still dig it - UPDATED 9/23/2012

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Originally posted by Miss Pie Does it suck to be so bitter and cynical? Lol.

i think he's got a point though. personnel structures in organisations (any organisations) can tend to get a little fat. im not researching this organisation for the simple reason im too poor, but if i was in a position to give money to somebody who isn't me, id be pretty careful of who i did business with.

i would absolutely want to see exact interest costs. if im lending my money for free, the NGOs had better have people selling some of their labour for free, and charging less than credit-card level interest rates to darkie.

i think the overall idea sounds excellent, id just wanna be sure that im not profiting the middlemen.

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Originally posted by Moral Hazard I'm just trying to figure out if this should be regarded as charity or capitalism.

Its more akin to capitalism, they're basically giving cheap loans to people that actually want to set themselves and their families up financially with small business ideas. Not just chuck lumps of cash at people who'll piss it away on something silly, which is the inherent problem of misdirected 'charity' where people have a diminished sense of ownership and value for anything just given for free.
Lot of this from what I've seen ends up going to things like farm implements, seeds and sewing machines so people can make a sustainable small business out of it, does actually work fairly well for what its worth.

I'm not much of a fan of charity either, too many cases of it being embezzled by some scrub in accounting, stolen by the local government or used as a weapon of influence by religious organisations.

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Originally posted by Penalba Yes, I am very cynical, which is the main reason I posted. To warn those who are thinking of donating. Now that you've read my warning, its up to you to decide of you trust this organization or not. I'm not looking for a debate, I just don't want people to support an organization that I believe are thieves.

Click on the field partner listed on each loan page. They list right there what their profitability is (return on assets) and it is nowhere close to gouging. In the large majority of cases they are making less than a 10% profit..and sometimes they are hovering just above 0-1% profit = pure charity.