Today’s guest post is from Seeds, a tech startup with a female founder working to build social good through microlending into every app that exists.
Most of us know what microloans are, right? They’re small loans — say $5 or $25 — given to people in need. These people can use the loans to buy livestock or supplies for their small businesses, and then pay back the loans with their proceeds.
What usually comes to everyone’s mind when they think about microloans is Kiva, the highly successful microlending nonprofit. (Fun fact: Bill Draper, one of Kiva’s investors, and Sam Birney, Kiva’s former Director of Engineering are investors in Seeds!) Kiva is awesome, but there’s actually a lot more to the world of microfinance than just what they do. We wanted to shed some light on this broader landscape today.
1. Microloans are not a type of nonprofit.
Because Kiva is a nonprofit, what seems to be a big misconception has propagated: that microlending is a category of nonprofit. In fact, it’s a type of lending and finance that happens to do a lot of social good. We think the “social good” part is what confuses people. People often don’t realize that social good doesn’t just come from nonprofits — it can also come from financial institutions, businesses and startups (like Seeds!)