Donating to individuals in underdeveloped countries is a trendy feel-good proposition that is getting a lot of attention right now. Ebay has recently launched microplace.com, a site where you can provide small loans to people around the world to help them start a business. Their tagline is “Invest Wisely, End Poverty.” Sounded like a great new idea to me…until I looked further.
Apparently the old adage, “there’s no such thing as a free lunch,” was taken to heart by microplace.com. In fact, it seems there’s not even such a thing as a discount lunch. When looking into the FAQ of the site, I noticed something peculiar.
For as a little as fifty dollars you can invest in an impoverished person trying to start or maintain a business, through a “lending organization”. In return for your good heartedness you will earn a scant 1.5% to 3% interest on your investment. 3% is not much, and if you truly have a good heart it still sounds like a great deal. Earn a little interest on some money, and help the poor. I was all for it. Ready to find someone in a country I had visited and help them out with a hundred or two. They could have even kept the 3% for all I care. I am blessed. I wanted to pay it forward. Then I looked further. Microplace’s lending organizations will then charge between 18% and 60% interest to those taking the loan.
Wait…60%!!!!!!! What? How is that “helping” the poor? How can an impoverished person in a third world country benefit by being driven into debt? And if they’re going to charge someone up to 60% on my money, I sure as hell better be being seeing more than a measly 3% return! I could not believe my eyes, it was really disturbing to me.
Now at the time of this writing those numbers are mysteriously missing. Apparently that wasn’t a frequent enough question. Maybe they would rather focus on the feel good aspect of the mission?
Also undisclosed in the FAQ is how much Ebay will charge in fees to the lending organizations. So how much of your money is actually making it to those underdeveloped countries?
I urge you to make sure you do your research before you give to a “charitable” (holding back the laughter) venture. Better yet, find someone in your travels and give the money directly to them. Charge them nothing. Expect nothing in return. You will be making a real difference in someone’s life, and bring joy to yourself. Maybe you can actually provide a free lunch to someone after all.
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1 response so far ↓
1 Jenn // Oct 27, 2007 at 10:56 pm
ahhh.
What sucks is that we shouldn’t be surprised by this….shady ass people.
I understand your need to “hold back from laughter” in regards to the “C” word.
I am extremely passionate about community and the poor, most of the time I would rather give things myself too, and no, you don’t expect anything in return. If you are giving to the poor, why the hell would you expect things back when you are the one in a position to “give”. You, the giver, are not the one in need…they are.
….up to 60%….:::Shaking Head:::
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