Kiva has been suffering the smackdown in the non-profit world as of late due to arguments put forth that their micro-loan model doesn’t function exactly – or at all – as implied. Donors operate under the perception that when they choose to support an entrepreneur listed on the Kiva website, their money is directly transferred to a local microfinance institution where it is then given to that entrepreneur for use and repayment. After your donation, you can physically see the increase in dollar amount that puts your selected entrepreneur closer to his or her goal.
The reality is that by the time you’ve selected which entrepreneur you’d like to support on Kiva’s website, they have already been funded by a microfinance institution. The microfinance institution completes a screening process for its loan applicants ahead of time and then gives the information to Kiva to post on its website. Fingers have been pointed that this is a severe breach of transparency on Kiva’s part because the donors aren’t actually funding the exact recipients they select.
Matt Flannery, co-founder and CEO of Kiva, put forth a compelling and articulate response that accepts fault for the unintentional misperception, but he also explains the necessity of the so-called “donor illusion.”
“One of the contributions that Kiva has made is to demonstrate that empathy increases generosity. The pictures and stories on the Kiva site increase understanding between various parties that would otherwise operate in completely different universes. When understanding increases, so does empathy. When empathy increases, so does generosity. People are inherently more generous towards people and causes they understand.”
David Roodman, a research fellow at the Center for Global Development, backs up this claim by asserting:
“What Kiva does behind the scenes is what it should do. Imagine if Kiva actually worked the way people think it does. Phong Mut approaches a MAXIMA loan officer and clears all the approval hurdles, making the case that she has a good plan for the loan, has good references, etc. The MAXIMA officer says, “I think you deserve a loan, and MAXIMA has the capital to make it. But instead of giving you one, I’m going to take your picture, write down your story, get it translated and posted on an American web site, and then we’ll see over the next month whether the Americans think you should get a loan. Check back with me from time to time.” That would be inefficient, which is to say, immorally wasteful of charitable dollars. And it would be demeaning for Phong Mut. So instead MAXIMA took her picture and story, gave her the loan, and then uploaded the information to Kiva. MAXIMA will lend the money it gets from Kiva to someone else, who may never appear on kiva.org.”
Yet the argument being waged against Kiva is not so much that it is morally indefensible to use this bait-and-switch method, but rather, that they should tell us when they’re doing it. And not in fine print. On the home page. Personally, I find this demand a little unnecessary. Is this conversation really even about Kiva? I don’t think so. I think it’s about something greater. It’s about donor behavior. I believe we are brushing up against some of the more embarrassing features of individual human nature.
What is it that compels us to complete a selfless act?
Are we really mad at Kiva because they weren’t being upfront about the fact that they have to use charming stories, rosy photographs, and real-time results in order to motivate us to donate to people who have already been funded (because they deserved to be, not because they looked good on paper)?
Do we want to know the truth about ourselves that bad?
Having worked for many non-profits myself, I can tell you the realities are demeaning for most. In the child sponsorship program, the cute children go first. To combat this shallow human inclination, we have a “lifeboat program” where children who are in desperate need of sponsorship are placed and supported by general charity funds until a new family offers to sponsor them. “Lifeboat children” are rarely described as cute. As a dedicated charitable organization, I believe it is our responsibility to weed out these flaws in human nature – ones that may not be obvious to the average donor – in order to ensure that everyone receives equal, quality service. Thus, our lifeboat program.
If you’re still crying about the validity behind your “person-to-person” model, then – pardon my French – get off your ass and travel to Africa. Fill your suitcase with clothes, medicine, food, and go. Physically place those donations in someone’s hands and actually feel the difference you have made. It’s possible in today’s world and if you’re not willing to do it, then don’t go throwing a fit over the “donor illusion” that Kiva may or may not perpetuate in order to inspire empathy in donors.
I don’t know where empathy comes from and I don’t understand people who don’t have it. I believe it is a sentiment that we are all born with, but it is the quality of our individual lives that teaches us whether to bring it forth or to bury it. Nathaniel Whittemore pokes at the nuances of charity in his post Kiva, Donor Idealism, and Why Most People Just Don’t Care About “Investing in Non-Profits.” He acknowledges that the barriers to donor-recipient emotional fulfillment is an obstacle that non-profits must persistently work around. Even if you wanted to travel to Africa and do your part, sometimes your money can be much more effective long-term than your short-term physical presence.
How do we instill empathy in our donors?
How do we make someone else’s struggle our own?
These are age-old questions for non-profits and they stretch far beyond the scope of running one organization. Our inability to empathize has more to do with the structures of the systems in which we live in – a beast so two-faced and unwieldy – that we can hardly expect a few dedicated individuals to change it. Thus, for me anyway, Kiva is off the hook. It is trying to do good operating within the systems of existence that it has been given. Matt Flannery responded eloquently to his criticisms. He means well, I feel it. At least, if anything, this Kiva conversation has made the average donor more aware of the thorn of “donor illusion”. Thus, we’ve all been given an extra opportunity for self introspection.
Contributor Profile: Ashley
Ashley is a friend of anyone who is fighting the good fight for social change. She currently resides in Bilbao, Spain where she is teaching English and researching the history of the Basque conflict. Personal blog
Twitter: @socialearth
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