Back in December, we expressed concerns about LAPO, one of Kiva‘s largest microfinance partners. Last month, the New York Times ran an article implying criticism of LAPO. Now, Kiva has suspended its partnership with LAPO. A couple of questions this raises: Which of the several objections to LAPO have led to the suspension? Several concerns…
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Celebrated charities that we don’t recommend
Note added April 2024: As we explain on our mistakes page, the tone of this blog post, which was written much earlier in our organizational history, fails to convey our uncertainty about the impact of these programs. It also doesn’t indicate that our research involves forming best guesses based on limited information, and that we…
Where we stand on microfinance charity
We’ve thought and written a lot about microfinance lately. As of now, here’s where we stand. What microfinance is and isn’t First, it’s important to recognize that most of what you’ve heard about microfinance is false. It isn’t primarily about funding business expansion.. It isn’t a “proven solution” to poverty. And it doesn’t leverage your…
LAPO (Kiva partner) and financial vs. social success
We recently looked at Kiva’s largest partner MFI, LAPO (Lift Above Poverty Organization), as part of our evaluation process for an economic empowerment grant in sub-Saharan Africa. In brief, we found two surprising pieces of information: LAPO is very profitable. There’s good reason to be concerned about LAPO’s social impact. As Natalie recently described on…
When donations and profits meet, beware
David Roodman raises the concern that Kiva capital could be effectively “padding profits” at a profitable microfinance institution. He concludes, If social investors provide capital at prices below commercial rates to enterprises with “double bottom lines” (profit and social benefit), how do the investors assure that their cheap capital isn’t being used to boost just…
Not our last word on the Kiva controversy
Nathaniel Whittemore writes that it’s “time to move on” regarding the recent Kiva controversy. I disagree. It’s true that Kiva handled the criticism admirably, and made significant changes to its website to improve clarity for donors. It’s also true that Kiva has a stronger case than many for being generally transparent and impactful. Finally, it’s…