Interview with Kiva Microfinance Founder, Jessica Flannery

Kiva's microfinance program uses crowdsourced lending to provide entrepreneurs in developing countries with capital to become successful.

Fourteen years ago, Grace Ayaa’s husband was brutally murdered by rebel forces in the Kitgum District during the Ugandan civil war. Grace barely escaped with her life, and spent several days in the hospital after being hit with a bayonet. As soon as she was released from the hospital, she packed her bags and took her four children, along with several war orphans, to a displacement camp in Kampala, in the southern end of the country, where they would be protected.

In Kampala, Grace was starting from nothing. She had no money, no job, and no one to help her care for her children and the others that she had taken in. She had to find a way to support her family somehow – so she decided to make peanut butter to sell to the other refugees in the displacement camp. The high-protein spread is a luxury in the camp, where resources are scarce, and Grace knew that her peanut butter would be popular. But she only had a small mortar and pestle to crush the peanuts, which is a time-consuming process, and she couldn’t afford to purchase many peanuts at a time. She was positive that the business would be successful, if she only had the resources to buy the proper equipment – but where would she ever get the money to do that?

Well, actually… from you.

Maybe you didn’t personally invest in Grace’s peanut butter business – but a group of individuals from developed nations just like yours did, thanks to the innovative microfinance organization, Kiva. Through Kiva’s website, you can visit profiles of third-world entrepreneurs like Grace, and lend them money to help them buy equipment for their businesses through Kiva’s partner microfinance banks all over the world. And you don’t have to give up your weekend getaway for the sake of helping out – by investing as little as $25, you can contribute to a fund that will turn someone’s life around.

Kiva was founded by Matthew and Jessica Flannery, a young married couple based in San Francisco, who were inspired to create the organization in 2005, after spending time in East Africa and talking to many of the people there.

“So many of them had done incredible things with just a small amount of money, and it was striking, and beautiful, and deeply moving. We wanted not just to know these individuals and hear their stories, but to share those stories, and to participate in them,” says Jessica.

When the couple came across struggling entrepreneurs who needed help to make their businesses profitable, they thought, “‘What if we could sponsor this business? What if we worked with our friends and family to lend them the money, and then follow their story throughout the course of the loan?’ The idea grew from there,” she adds.

And grow it has: In just two years of operation, Kiva has distributed over $13 million in loans to struggling businesses all over the world, thanks to the investments of more than 133,000 everyday people from countries as diverse as Korea, Malaysia, and the tiny European republic of Luxembourg.

Despite what you might think, this isn’t simply another form of charity – these are real investments, and the business owners are paying them back at rapid rates: Of the loans that have reached the end of their payback periods, over 99.7 percent have been repaid in full. That means investors get every last cent of their money back, which they can reinvest into other businesses through Kiva if they like.

To the Flannerys, Kiva’s business-minded model is an essential part of the organization’s philosophy. Jessica claims that founding Kiva “has reinforced my belief that we are all unavoidably, deeply connected, and that we ought to be very careful to think about how our actions affect the global community. It’s also reinforced my desire to interact with people who lack certain resources or opportunities in a way that is dignified and champions empowerment, respect, strength, and partnership,” as opposed to charitable organizations that are “focused on poverty, suffering, [and] need.” Kiva hopes “to become the main way that people come to connect with and directly empower another human being,” says Jessica.

In Grace Ayaa’s case, the $425 loaned to her through Kiva has driven her peanut butter business to great success, enabling her to support her children and the many war orphans that she has taken in. Now, she told PBS in an interview, “I managed to raise some money, which allowed me to get a small piece of land where I feel that my next Kiva loan is going to help me start a building for my family.” She is so grateful for the support, in fact, that she’s become involved with helping other villagers receive loans through Kiva.

“I’m happy that even with nothing, people managed to get their loans and right now what I’m seeing, many people have built,” she told PBS. In her village, fellow refugees have set up businesses including a barber shop, a tap for clean drinking water, and retail shops, thanks to investments through Kiva. It only takes a little bit of money from those who can spare it to make a huge difference in the lives of struggling entrepreneurs – and in this small Ugandan refugee camp, Kiva has given the residents something they’ve never had before: The promise of a better life.

Learn more about Kiva and become an investor at their website,

Watch a video interview with Grace Ayaa.