With more than 10 million U.S. small businesses in need of additional capital, microlending website Kiva.org has teamed up with Visa on a new program designed to raise awareness and understanding of microfinance opportunities.
The new program, Kiva City, set to be formally introduced this afternoon by Former President Bill Clinton at the Clinton Global Initiative America conference in Chicago, aims to spur job growth and economic recovery by connecting Kiva’s global network of nearly 600,000 individual lenders with the owners of small businesses throughout the country.
Currently, Kiva.org microloans are only available in select portions of the nation, including San Francisco, New York City and Texas.
"Kiva City is a way to extend the branch network of microfinance institutions in the U.S.," Premal Shah, cofounder of Kiva.org, told BusinessNewsDaily. Kiva City will employ civic and business leaders as well as community members to conduct on-the-ground outreach to small business owners to support the three components of microlending, which include sourcing the businesses to apply for microloans, administering the loans and funding the loans.
"It allows community and civic group leaders to essententially get trained on the fact that microloans are available," Shah said. "They can educate small businesses by visiting them in person."
Shah said Kiva City is specifically targeting areas that have been hardest hit economically by the recession.
The program is kicking off in Detroit, which ranked fifth in a new Economist Intelligence Unit list of the top U.S. small business trouble spots.
In Detroit, Kiva City is working with Michigan Corps, a social network of local and global residents committed to positive change in the state, to launch the project.
Michigan Corps Executive Director Anuja Jaitly said having that personal interaction with small business owners is key in their understanding of the funding options that are available.
"It is critically important to have people on the ground who can meet with business owners one-on-one," Jaitly said.
Through local networking events, church gatherings, and neighborhood BBQs, Michigan Corps has been able to build an engaged community of small business owners and lenders alike.
The goal is extend the Kiva City program into other parts of the country that are most in need, which – according to the Economist Intelligence Unit study – include Cleveland, Miami, Pittsburgh, Orlando and Minneapolis. For that to happen, Kiva needs to know there is a group of community and civic leaders who are ready and willing to volunteer, Shah said.
"We need a critical mass before we can invest the time in each city," Shah said. "The faster we can start things, the more impact we can make."
Community and business leaders interested in volunteering are encouraged to visit the Kiva website to enroll.