NEW YORK - Fueled by last year's Nobel Prize for a man nicknamed "banker to the poor," microlending to small businesses in the world's poorest countries is booming as individuals discover they can be their own mini World Bank.
And you don't have to be Bill Gates to get in on the act.
A microfinance Web site that lets people lend as little as $25 to small businesses from Vietnam to Kenya is drawing so much interest from lenders that it's struggling to keep up.
Kiva.org, described by founder Premal Shah as an "eBay for microfinance," has been operating for two years but saw traffic surge after Bangladeshi economist Muhammad Yunus won the Nobel Peace Prize last year as the founder of Grameen Bank.
"Overnight the volume of the traffic to our site pretty much doubled," Shah said of the Nobel Prize's impact, noting recent publicity and a mention in Bill Clinton's new book "Giving" prompted another surge in interest that has left Kiva seeking more borrowers to take all the available money.
Kiva works with dozens of microcredit groups who pick needy businesses -- from a Honduran woman selling cosmetics to a Cambodian weaving business or a Ghanaian car repair shop.
"We're providing an online platform for connecting the microfinancing people in the field with someone in Des Moines, Iowa, or someone in London," Shah told Reuters.
Shah said the average user funds four businesses on the Web site, putting $25 into each business and that about $11 million has been lent so far with no interest charged. He hopes to loan $100 million in the next three years.
The site has photographs and business plans from people seeking amounts that range from $75 to over $1,000. In a system that mirrors online stores, each microcredit firm is rated according to whether loans have defaulted in the past, how long it has been operating and the total amount of loans.
"If they're not reliable they're not able to raise more money," Shah said.
PHILANTHROPIC BOOM FOR RICH AND POOR
Jacqueline Novogratz, an ex-banker who founded the Acumen Fund in 2001 as "a venture capital fund for the poor," linked "new philanthropy" to the tech boom and the changing economy.
"Philanthropy has traditionally mirrored the economy in which it's functioning, so Rockefeller who created the first foundation mirrored the industrial revolution approach."
