Start your own bank (Part 2)

Posted by Matt
I recently posted about lending through Prosper.com. Today, I read a similar article on GetRichSlowly (thanks J.D.!) about the Grameen Bank, microlending, and Kiva. I hadn't heard of Kiva before and noted a few interesting differences between it and Prosper:

1. Prosper is domestic; Kiva is for foreign lending


2. Prosper loan requests are often for debt consolidation/relief; Kiva is focused on lending to entrepreneurs


3. Prosper loans pay the lender interest; Kiva loans do not.

This leaves me in a bit of a quandary about where I'd put my money if I get to a point where lending makes sense for me. I'd like to "act local" (and, admittedly, earn interest), but I also feel better about lending to someone who wants to use the money to invest in their future rather than pay off past consumer debt. I'm probably over-simplifying. If there are any readers out there who have experience with either site, I'd love to hear about it.

Interesting side note: compare our early "Basic Rules of Finance" at right with the Grameen Bank's 16 decisions. It's a nice reality check and a reminder of how lucky we are in our country that I have to worry about my retirement investments and not about clean drinking water or setting up a pit latrine!