and indeed in those cases where they ARE going through a field partner, they DO actually pay interest to them Average interest rate that somebody else gets on our money (not the receiver of the loan) is 20%
'The self reported average, annualized, flat interest rate in real terms charged by the Field Partner to the enterpreneur. Note that Kiva.org does not currently take a cut of the interest rate charged by Field Partners and instead relies on an optional lender fees/donations to help pay for running our website (small core staff, rent, servers, etc).
If the Field Partner interest rate seems high, consider the following:
Field Partner interest rates are a highly affordable alternative to the local money lender
Local money lenders - often the only option for poor entrepreneurs to get a loan - charge interest rates ranging from 60% to 800% annualized.
A poor entrepreneur can generate greater benefits from additional units of capital than can a highly capitalized business, because she or he begins with so little.
According to the World Bank, studies covering India, Kenya, and the Philippines found that the average annual return on investments by microbusinesses ranged from 117 to 847 percent.
The costs of making a micro-loan in the developing world are higher versus larger loans in the West.
Cost of screening - Field Partners must screen entrepreneurs who commonly have no credit history, no collateral, are frequently illiterate, and often live in remote areas. To responsibly assess the credit worthiness of each entrepreneur, the cost is higher than the West where most everyone has a credit score and screening / loan application can be done electronically.
Cost of in person collections - Field Partner staff typically travel to each entrepreneur on a monthly basis to make collections. Compared to the West, where mail and internet repayments are standard, the costs are higher.
Cost as a size of the loan - If the Field Partner's actual cost per loan is $25, the percentage cost is 0.25 percent for a $10,000 loan, but 25 percent for a $100 loan.
Field Partners must charge an interest rate that allows them to pursue their social impact agenda sustainably.
In order for Field Partners to reach more of the poor with relatively low interest loans (vs. local money lender), they need to cover their costs.
Given the higher costs of microloans discussed above, Field Partners must charge a sufficient interest rate.
Kiva aspires to provide transparency around the social impact and relative Field Partner interest rates in order to ensure to reward Field Partner that successfully create social value while lowering their costs to do so. '
Sorry.
That just nailed it in the coffin for me.
THIS IS CRAP.
Someone is RAPING these people at 20 FUCKING PERCENT !?!
The person actually providing the funds gets JACK SHIT ... in fact, if you keep it on your card you are probably PAYING 9-28% depending on how shitty your credit card rate is.
SO ...
to recap ...
most of these loans, through a field partner ...
COST YOU 10-20% ON YOUR CREDIT CARD
EARN SOME BANKER FUCK 20% ON YOUR LOAN.
NET SUM FOR THE BANKER PIGS:
30-40% !
Think of it that way!
:( :( :(
If someone REALLY wanted to pull this idea off the "honest" way, you would say "fuck it with the "credit checks and field partners" ... do an Ebay type rating system where these people some how get commented on by other user-lenders ... "i lent him $25 and he has been paying steady, highly recommended" ... get other local indigents on the take for dollars a month (probably a huge salary for them) and have them scout out other worthy loan recipients. Hell set up a store and staff it in all these regions with locals, call it "Loans R Us" and let em walk in and apply ... it shouldn't cost 20 goddamn Percent.
or just suck it up, and acknowledge that lending small amounts to indigent folks is small potatoes, and who gives a fuck if you get your $25 back ... but the USER\LENDER would make 7-15% and NO ONE ELSE GETS RICH ... the site gets its money through advertising, good will, donations ... what ever ... but THE INDUSTRY IS FUCKING YOU ON THIS!
I'm sorry.
I can't support this idea, knowing that some "Field Partner" is pulling in 20 goddamn Percent on this! AND you are forced to use a credit card at an interest LOSS with NO upside AND its done all under the implicity grounds that the loan is ZERO PERCENT, even though the fine print states FAR TO THE CONTRARY!
It's absurd!
If I was to smile and I held out my hand
If I opened it now would you not understand?
I kinda agree... ok you can click on each 'loan partner' as that credit union one only takes 3% but still, it does seem that the financial partners are benefiting too much from what is basically a charitable donation. I'd rather donate my money to goal who are the best charity in the world for cutting through red tape and getting the money where it's needed. I really do like the idea of this though and would love to do it if I knew pretty much every penny was going to the person I want it to go to. I also didn't like the way you have to find this stuff out for yourself. The details about the loan partner should be on the home page.
see.. it doesn't say anything about your money going to a partner... it says they use partners and what the role of a partner does... but it still implies all your money goes to the loan recipient
The Astoria??? Orgazmic!
Verona??? it's all surmountable
Dublin 23.08.06 "The beauty of Ireland, right there!"
Wembley? We all believe!
Copenhagen?? your light made us stars
Chicago 07? And love
What a different life
Had I not found this love with you
get other local indigents on the take for dollars a month (probably a huge salary for them) and have them scout out other worthy loan recipients. Hell set up a store and staff it in all these regions with locals, call it "Loans R Us" and let em walk in and apply ... it shouldn't cost 20 goddamn Percent.
that's quite a good idea... he/she could also be someone you could donate to... like the way kiva runs on donations directly to them rather than a cut of individual donations.
The Astoria??? Orgazmic!
Verona??? it's all surmountable
Dublin 23.08.06 "The beauty of Ireland, right there!"
Wembley? We all believe!
Copenhagen?? your light made us stars
Chicago 07? And love
What a different life
Had I not found this love with you
it sounded really dodgy from the off... i'll continue with my monthly payments to Save The Children (from Helen) which i know goes somewhere good and i'm okay with not getting my money returned.
I didnt like to say yesterday, but i dont really agree with helping people set up businesses and stuff like that.. i dont have a business and i'm damn sure nobody would give me a interest-free loan to start one... also i'm helping a business owner get even wealthier (relatively speaking) than people who are perhaps poorer in that area.... meanwhile thousands starve to death in Africa every week.
its a case of who needs it the most for me, and in my eyes thats kids... hence my monthly payment above.
but each to their own
oh scary... 40000 morbidly obese christians wearing fanny packs invading europe is probably the least scariest thing since I watched an edited version of The Care Bears movie in an extremely brightly lit cinema.
I'm gonna ammend this post to keep it short and keep the flames down.
1. I think it sucks that they only accept "loans" in the form of CREDIT CARDS.
It fucks the lender, by forcing them to MAKE INTEREST PAYMENTS on a loan, of which they receive NO INTEREST.
2. I think it is funny that YOU can not make any money, but the guy who is running this gets a salary. Infact, everyone on staff is getting paid, i imagine.
3. I think they would get a LOT more lenders if they would just charge even some token interest to these people. Say 3%
4. I think this system errodes the free market on some level.
If you think about it, for every person out there on this site getting a 100% subsidised NO INTEREST loan, there is another guy out there somewhere who didn't get on this site, who is trying his damnedest to get a loan like every other honest joe in this world, and HE IS NOW AT A SEVERE DISADVANTAGE because YOU gave the OTHER guy a FREE LOAN!
Just think about it.
Is THAT fair?
I dunno.
:(
1. why would you pay any interest? either you use a Debit Card (or whatever they're called where you are) or you pay off your CC in full each month.
if you're in CC debt, you probably shouldn't lend out money to someone else anyway..
you say somewhere else: Even if you are paying off your card in full, you are still losing the "Time Value" of your money.
I use CC to actually GAIN time-value...it's in effect a very short-term (few weeks) loan if you repay in full every month.
2. do YOU work for free?
3. that would help, but it's complicated tax-wise, especially as it's cross border.
I see the system more as a charitable fund to which one does not have to add all the time..
4. :rolleyes: free market is a myth! if it existed there's be no trade barrier or import duty and no financial regulation whatsoever...that'd be called Anarchy actually!
Sorry.
That just nailed it in the coffin for me.
THIS IS CRAP.
Someone is RAPING these people at 20 FUCKING PERCENT !?!
The person actually providing the funds gets JACK SHIT ... in fact, if you keep it on your card you are probably PAYING 9-28% depending on how shitty your credit card rate is.
SO ...
to recap ...
most of these loans, through a field partner ...
COST YOU 10-20% ON YOUR CREDIT CARD
EARN SOME BANKER FUCK 20% ON YOUR LOAN.
NET SUM FOR THE BANKER PIGS:
30-40% !
Think of it that way!
:( :( :(
If someone REALLY wanted to pull this idea off the "honest" way, you would say "fuck it with the "credit checks and field partners" ... do an Ebay type rating system where these people some how get commented on by other user-lenders ... "i lent him $25 and he has been paying steady, highly recommended" ... get other local indigents on the take for dollars a month (probably a huge salary for them) and have them scout out other worthy loan recipients. Hell set up a store and staff it in all these regions with locals, call it "Loans R Us" and let em walk in and apply ... it shouldn't cost 20 goddamn Percent.
or just suck it up, and acknowledge that lending small amounts to indigent folks is small potatoes, and who gives a fuck if you get your $25 back ... but the USER\LENDER would make 7-15% and NO ONE ELSE GETS RICH ... the site gets its money through advertising, good will, donations ... what ever ... but THE INDUSTRY IS FUCKING YOU ON THIS!
I'm sorry.
I can't support this idea, knowing that some "Field Partner" is pulling in 20 goddamn Percent on this! AND you are forced to use a credit card at an interest LOSS with NO upside AND its done all under the implicity grounds that the loan is ZERO PERCENT, even though the fine print states FAR TO THE CONTRARY!
It's absurd!
I can't believe you can be so stupid!
first you complain how lending without interest is wrong for the 'economy', then when told that in fact there's an interest, you rave it's unfair?!?
and drop the Credit Card..if you're dumb enough to pay that kind of rates to your bank, you shouldn't be lending money to anyone.
lastly, how, do you think regular bank lend money? they use the one you have in your accounts ..therefore making interest out of YOUR money without giving it to you..
:rolleyes:
first you complain how lending without interest is wrong for the 'economy', then when told that in fact there's an interest, you rave it's unfair?!?
and drop the Credit Card..if you're dumb enough to pay that kind of rates to your bank, you shouldn't be lending money to anyone.
lastly, how, do you think regular bank lend money? they use the one you have in your accounts ..therefore making interest out of YOUR money without giving it to you..
:rolleyes:
1. Drop the personal attacks. I'm not stupid, and you don't need to go flinging insults to get your point across.
2.
a) Yes, i complained that not charging intrest would not be fair. it wouldn't, see above for that explanation.
b) Yes, i am NOW complaining that 20% is TOO much.
Here is the problem, if they came out and said straight up, "you lend money, WE charge 20% on YOUR money" i wouldn't have a problem. but the average joe is being CONNED, yes CONNED, in to believing that they are lending out their money for free. Instead you are lending YOUR money to a banker for free and he is turning around and lending it out to some poor fuck for TWENTY PERCENT? All, again, under the guise to YOU the real lender, that your loan was "free" ... That is what is stupid.
3. Yeah. Bankers take your money "on deposit" and lend it out. It's called fractional reserve banking and it has been to blame for just about every major economic problem in the modern era. The inherent problems (short term liquidity) with fractional reserve banking are the very reason 7 super-rich assholes got togeather to form the Federal Reserve System in America in the first place. I completely disagree with it. Before the Reserve was set up, banks were losing money ... why? Because tight lending policies were causing businessmen to SAVE and use CAPITAL to expand ... i'd rather see the world tighten it's belt and run on real wealth rather than spend money that doesn't exist and cause potentialy catastrophic events to occur at the expense of the people all while the banks are raping the world. Don't think it costs the people any money? Of the over $9,000,000,000,000 in Federal Debt, about $1,400,000,000,000 is a result of the Savings and Loan "scandal" alone ... i say "scandal" because it was NOT, it was a government BAIL OUT for no reason other than they promised to BAIL OUT! Just like the FDIC and the FRS. Think about it, at LEAST 1\8th of the federal debt is directly related to bad banking practice. The truth is about another 40% is DIRECTLY the responsibility of the FRS in the first place. But that's another story.
Whatever. It sounds like YOU are the one who could use some brushing up on "modern economic theory" and the truth behind those "theories" ... the truth that the only person winning at the end of the day is the ultra-rich banker fuck ... even little banks can't compete any more. Why? Because the Federal Reserve System makes it patently unfair to the little guy.
So whatever.
Yeah, i think it's crap that this site comes off as you giving money for free to someone, but the reality is the banking industry is making between 15 and 40% at the end of the day.
And my credit score is 800+ and my card rate is 7.99%
I'm not stupid, go insult someone else!
If I was to smile and I held out my hand
If I opened it now would you not understand?
1. Drop the personal attacks. I'm not stupid, and you don't need to go flinging insults to get your point across.
2.
a) Yes, i complained that not charging intrest would not be fair. it wouldn't, see above for that explanation.
b) Yes, i am NOW complaining that 20% is TOO much.
Here is the problem, if they came out and said straight up, "you lend money, WE charge 20% on YOUR money" i wouldn't have a problem. but the average joe is being CONNED, yes CONNED, in to believing that they are lending out their money for free. Instead you are lending YOUR money to a banker for free and he is turning around and lending it out to some poor fuck for TWENTY PERCENT? All, again, under the guise to YOU the real lender, that your loan was "free" ... That is what is stupid.
3. Yeah. Bankers take your money "on deposit" and lend it out. It's called fractional reserve banking and it has been to blame for just about every major economic problem in the modern era. The inherent problems (short term liquidity) with fractional reserve banking are the very reason 7 super-rich assholes got togeather to form the Federal Reserve System in America in the first place. I completely disagree with it. Before the Reserve was set up, banks were losing money ... why? Because tight lending policies were causing businessmen to SAVE and use CAPITAL to expand ... i'd rather see the world tighten it's belt and run on real wealth rather than spend money that doesn't exist and cause potentialy catastrophic events to occur at the expense of the people all while the banks are raping the world. Don't think it costs the people any money? Of the over $9,000,000,000,000 in Federal Debt, about $1,400,000,000,000 is a result of the Savings and Loan "scandal" alone ... i say "scandal" because it was NOT, it was a government BAIL OUT for no reason other than they promised to BAIL OUT! Just like the FDIC and the FRS. Think about it, at LEAST 1\8th of the federal debt is directly related to bad banking practice. The truth is about another 40% is DIRECTLY the responsibility of the FRS in the first place. But that's another story.
Whatever. It sounds like YOU are the one who could use some brushing up on "modern economic theory" and the truth behind those "theories" ... the truth that the only person winning at the end of the day is the ultra-rich banker fuck ... even little banks can't compete any more. Why? Because the Federal Reserve System makes it patently unfair to the little guy.
So whatever.
Yeah, i think it's crap that this site comes off as you giving money for free to someone, but the reality is the banking industry is making between 15 and 40% at the end of the day.
And my credit score is 800+ and my card rate is 7.99%
I'm not stupid, go insult someone else!
i wasn't insulting you so much as expressing disbelief...text form is not the best way to reflect that kind of nuance, sorry.
the 20% rate is pretty well explained and totally makes sense...and they're not hiding it, the quoted text is FROM the FAQ on the website!
it's NOT a money-making scheme for the lender, it's not an investment, it's a charitable endeavour! just one where your money goes a much longer way than just giving it away once.
if you want to see it as anything else, move on!
a lot of ANY charitable donation is eaten up by the running of the charity.
the WHOLE lending principle, in any shape or form, relies on the system I described. apart from 1-1 borrowing, there's no other way it can work.
and though debt is a problem, lack of savings is one too, but you can't have savings earning any kind of interest if no-one is borrowing.
and there wouldn't be businesses without borrowing, nobody but the already rich can upfront capital, and nobody could own their home without borrowing either...
Banking crisis comes from bad lending, i.e. to people that don't repay, often because they've been lend too much at bad rates. that's the only way a bank can lose money (or speculate unwisely..which in effect is the same thing). The principle is sound, it's the greed of the banks (and their shareholders) that screws it up.
My bank is a Building Society btw..it means the clients are the shareholders and any benefit is put back in the society...that's why most of the charges are lower there than at normal banks and interests rates more competitive.
and btw, you CAN pay without a CC..Paypal in the US and the UK accepts bank transfers...or just use a bloody regular bank card ffs, not difficult!
If you choose to buy something on credit, don't blame the shop for the interest you're paying on it!
the WHOLE lending principle, in any shape or form, relies on the system I described. apart from 1-1 borrowing, there's no other way it can work.
I like how you state the alternative, and then gloss over it.
The whole lending system in CURRENT shape and form relies on the pyramid scheme you implied. See bolded section for an alternative.
Banking crisis comes from bad lending[...]that's the only way a bank can lose money.
Bullshit. This is outright rubbish.
In fact, you only have to look to the ten years preceding the meeting at Jekyll Island (1900-1910) to tell you otherwise.
In those ten years banks were going insolvent at some alarming rates, and it had NOTHING to do with bad debt. The economy was actually doing amazingly well. The only problem the banks were having is that they were LENDING TOO MUCH, and they HAD NOTHING HELD IN RESERVE. Ok, relatively nothing ... i mean, when your outstanding liabilities outpace your assets to cover by a margin of 300-33,000% ... yeah 33,000% ... you are doomed for disaster ... that's what happens when you take ONE dollar in deposits, loan out 10 on that 1 and then take that 1 and reinvest 98 cents of it ... you are left with 2 cents to cover 10 dollars ... THAT IS WHAT THE BANKS DO!
THAT is why they used to go broke ... NOT BAD DEBT ... it was simple insolvency due to liquidity that arose directly from over extending their credit lines!
THAT is why the Federal Reserve was created in America.
That is EXACTLY why we have the current system... so BIG banks can be as wreckless as they want, and their stupidity will be covered with the backing of someone ELSES liquidity ... and then if everyone is playing stupid ... Uncle Sam will step in and fuck the tax payer with inflation (ie printing more worthless trash)! You need to read up on the history of this shit. It's scary.
it's the greed of the banks (and their shareholders) that screws it up.
Well, i guess you got that part right.
This is like calculus ... you got the right answer, but the wrong math to back it.
The greed of the banks is INHERENT in the current system. The Federal Reserve System ENCOURAGES banks to be wreckless ... in FACT, if you AREN'T being wreckless with your lending, you are LESS likely to stay in business.
Why?
Because some other giant bank (JP Morgan Chase, or Citibank, perhaps !?!) that knows the rules (probably because their founding fathers INVENTED the rules on Jekyll Island in 1910) will use them, just as they were intended to be used.
Namely: LEND LEND LEND.
LEND TO THE BIGGEST HIGHEST INTEREST (read: RISKIEST) BORROWER YOU CAN FIND -- the Federal Government is always a SURE bet --
then, when the borrower is nearly broke, right off the loan as a loss?
Oh wait, no ... LEND THEM SOME MORE ... that's right ... ROLL IT OVER ... Federal Government Debt anyone?
Hell, LEND THEM TWICE AS MUCH!
Give 'em half to pay you interest, and half to spend more on themselves.
Then 10 years later when they are flat broke again (Federal Government?) LEND THEM DOUBLE OR TRIPLE and EXTEND THE TERMS OF THE LOAN
(hey, how would you like this as a private citizen: Oh Mr. Smith, having trouble paying your 500K home mortgage at 6% for 30 years? Oh, alright, we will refinance at 600K and put 100K in your pocket and finance the whole thing at 10% for SIXTY years!)
THAT is why banks get in "trouble".
Except, that TODAY ... THEY DON'T GET IN TROUBLE.
[unless you are a small bank lending to the common man. then uncle sam tells you to fuck off. you aren't "essential" to the system, and are expendable. only when you are one of the big boys do you get the bailout!]
They take their borrower up to Capitol Hill -- Chrysler, Penn Central [yay, we got AMTRACK out of that bullshit!], Lockheed Martin, etc -- and the banks AND their borrower PLEAD TO CONGRESS -- Oh Please Uncle Sam ... If you let us both go bankrupt, the American people will suffer ... 20,000 jobs will be lost and the Country will NEVER be the same ... YOU HAVE TO BAIL US OUT! PRINT MORE MONEY, AND GUARANTEE ME THESE LOANS ... HELL, MAYBE YOU COULD TRADE ME SOME OF MY SHITY LOANS FOR STOCK IN MY SHITY COMPANY !?!?
My 11yr old son got busted at school with $150.00.
The reason the school found it was because he had shared it out in lots of 10 and 20 to all his friends (which makes me laugh with small pride) and they rocked up at the canteen flashing the cash.
It turns out he found it like he said, we havnt found the owner and we retrieved all but 40 of it, so it looks like going into the school coffers.
I'm gonna ammend this post to keep it short and keep the flames down.
1. I think it sucks that they only accept "loans" in the form of CREDIT CARDS.
It fucks the lender, by forcing them to MAKE INTEREST PAYMENTS on a loan, of which they receive NO INTEREST.
2. I think it is funny that YOU can not make any money, but the guy who is running this gets a salary. Infact, everyone on staff is getting paid, i imagine.
3. I think they would get a LOT more lenders if they would just charge even some token interest to these people. Say 3%
4. I think this system errodes the free market on some level.
If you think about it, for every person out there on this site getting a 100% subsidised NO INTEREST loan, there is another guy out there somewhere who didn't get on this site, who is trying his damnedest to get a loan like every other honest joe in this world, and HE IS NOW AT A SEVERE DISADVANTAGE because YOU gave the OTHER guy a FREE LOAN!
Just think about it.
Is THAT fair?
I dunno.
:(
Some people pay their credit cards off each month, and if someone prefers to pay with a check, they can simply charge the loan on their credit card, and then pay that same amount on their credit card right away.
I hope most lenders are smart enough to realize that they may never get paid back. This is more of a charity, so anyone who doesn't understand the giving spirit of the program, and insists on thinking of it as an investment, will just be disappointed.
Many charities employ full-time employees who get paid real-world salaries. Paying a skilled fundraiser is done in hopes of increasing donations to the cause, and it is the norm.
If someone feels the need to collect 3% interest on say a $200 loan, that would amount to $6 of interest income per year.
I, for one, would question the compasion of someone who would insist on collecting interest on one of these loans...that would be just plain selfish!
This is, in a sense, a charitable program, yet the form of the payment to the receipient helps them learn about business, and it prevents them from feeling as if they are accepting charity. This isn't like some kids asking their parents to fund their baseball card table at a swapmeet...these are businesses that will hopefully allow the owners to earn enough money to cover basic living expenses.
For those of you who question the program, and need to rationalize the "business sense" of it, just think, if the economies in the countries benefiting from the programs inprove, they may require less aid from the U.S., which would allow taxes to be lowered (in theory), which would put more money in your pocket (in theory).
I, for one, would question the compasion of someone who would insist on collecting interest on one of these loans...that would be just plain selfish!
That's my point.
What is with you people?
THE BANKER IS MAKING 20 FUCKING PERCENT!
And if you don't read the fine print in the FAQ, you come off first glance thinking you are loaning FREE money to these folks. Which you are NOT!
And it is NOT a charity. It is a BANK MAKING 20% OFF OF YOUR MONEY. THE ONLY PERSON GETTING CHARITY OUT OF THIS IS THE GODDAMN BANK
That is a FACT!
In fact it isn't even 20% at that point. From a cash on cash stand point it is an INFINITE RETURN.
I just think it is stupid.
If the banks want to lend money at 20% to these damned people, they have plenty of ways to get the money. They don't need you to shell it out on credit card.
And i wish you folks would stop explaining to me how a credit card works, and how to pay it off. I get that. Duh! But most folks who donate are going to leave this on their cards. Thats just the way the world is these days.
If I was to smile and I held out my hand
If I opened it now would you not understand?
That's my point.
What is with you people?
THE BANKER IS MAKING 20 FUCKING PERCENT!
And if you don't read the fine print in the FAQ, you come off first glance thinking you are loaning FREE money to these folks. Which you are NOT!
And it is NOT a charity. It is a BANK MAKING 20% OFF OF YOUR MONEY. THE ONLY PERSON GETTING CHARITY OUT OF THIS IS THE GODDAMN BANK
That is a FACT!
In fact it isn't even 20% at that point. From a cash on cash stand point it is an INFINITE RETURN.
I just think it is stupid.
If the banks want to lend money at 20% to these damned people, they have plenty of ways to get the money. They don't need you to shell it out on credit card.
And i wish you folks would stop explaining to me how a credit card works, and how to pay it off. I get that. Duh! But most folks who donate are going to leave this on their cards. Thats just the way the world is these days.
OMFG.
Someone [Hein. Helen?] posted a quote from the FAQ on the site.
I and others were wondering if this really was interest free money that users of the site were lending ...
If the Field Partner interest rate seems high, consider the following:
Field Partner interest rates are a highly affordable alternative to the local money lender
Local money lenders - often the only option for poor entrepreneurs to get a loan - charge interest rates ranging from 60% to 800% annualized.
A poor entrepreneur can generate greater benefits from additional units of capital than can a highly capitalized business, because she or he begins with so little.
According to the World Bank, studies covering India, Kenya, and the Philippines found that the average annual return on investments by microbusinesses ranged from 117 to 847 percent.
The costs of making a micro-loan in the developing world are higher versus larger loans in the West.
Cost of screening - Field Partners must screen entrepreneurs who commonly have no credit history, no collateral, are frequently illiterate, and often live in remote areas. To responsibly assess the credit worthiness of each entrepreneur, the cost is higher than the West where most everyone has a credit score and screening / loan application can be done electronically.
Cost of in person collections - Field Partner staff typically travel to each entrepreneur on a monthly basis to make collections. Compared to the West, where mail and internet repayments are standard, the costs are higher.
Cost as a size of the loan - If the Field Partner's actual cost per loan is $25, the percentage cost is 0.25 percent for a $10,000 loan, but 25 percent for a $100 loan.
Field Partners must charge an interest rate that allows them to pursue their social impact agenda sustainably.
You tell me.
Is it justifiable to run a site that, on the face of it this site purports that you are lending 0% interest money to these poor people ... but if you bother to read the FAQ, you see that SOMEONE ELSE is taking 20%?
You would think that what ever money is supporting this REGISTERED NON PROFIT site would also support the lending cost of YOUR LOAN ... but NO ... in addition to whatever money this site is pulling in to operate, they ALSO tack on a 20% fee to MOST loans that YOU give out.
SO YOU TELL ME.
WHATS GOING ON?
Look.
I don't care what you do with your money.
I'm just saying i don't like the way it's structured,
and its my right to voice my disagreement with the way the site "purports" to operate from a first glance perspective ... and the way the fine print spells it out ...
which is namely ... you think you are "giving" free loans to people, but the banker is charging interest on it.
Why fucking bother with the site then.
They are really that hard up for the loan origination cash?
Why not just ask bill gates for 200,000K or something?
Surely all the 25-$1000 loans ever processed through this site cant be much more than that. Fuck it. Just give em the cash. But fuck giving MORE money to bankers.
Sweet jesus, folks!
ONCE AGAIN.
IF YOU LEND ON THIS SITE
YOU ARE DOING NO ONE ANY GREAT "CHARITY" [EXCEPT FOR THE BANKER, HE THANKS YOU PROFUSELY FOR FOOTING BOTH THE COST AND THE RISK INVOLVED IN THIS LOAN]
YOU ARE SIMPLY FACILITATING A BANK IN EXTENDING A VERY HIGH RATE LOAN TO SOMEONE WHO DOES NOT NEED TO BE BORROWING AT 20%!
EDIT:
You know what.
Fuck it.
I CONCEDE.
If these people really are only getting offers of 100-800% interest loans,
20% is great!
Fine.
I guess to me it would suck.
But i guess it is the best the "civilized" world can do to help these poor folks.
It takes some white man walking across the scorched earth of zimbabwemizakistan to collect, and he has to do this and that to ensure that Chimichuri will repay her loan and that effort as a fractional percentage of the total tiny little loan is abormaly high compared with "conventional" western loans ... fine ... i get it.
Oh well.
GO AHEAD.
USE THIS SITE.
I APPROVE.
If I was to smile and I held out my hand
If I opened it now would you not understand?
I'm gonna ammend this post to keep it short and keep the flames down.
1. I think it sucks that they only accept "loans" in the form of CREDIT CARDS.
It fucks the lender, by forcing them to MAKE INTEREST PAYMENTS on a loan, of which they receive NO INTEREST.
2. I think it is funny that YOU can not make any money, but the guy who is running this gets a salary. Infact, everyone on staff is getting paid, i imagine.
3. I think they would get a LOT more lenders if they would just charge even some token interest to these people. Say 3%
4. I think this system errodes the free market on some level.
If you think about it, for every person out there on this site getting a 100% subsidised NO INTEREST loan, there is another guy out there somewhere who didn't get on this site, who is trying his damnedest to get a loan like every other honest joe in this world, and HE IS NOW AT A SEVERE DISADVANTAGE because YOU gave the OTHER guy a FREE LOAN!
Just think about it.
Is THAT fair?
I dunno.
:(
non profit organizations are a good scam. non profit means the business doesn't make a profit. the guy that started this can pay himself $100K/year (or whatever he wants) and it's ok. he can buy a car and deduct it along with many other things.
if my surgery goes well i'll be starting a non profit organization to rebuild a pony express stage stop. it will be a "museum" open to the public but it will also have a gift shop rented to my other business which is not non profit.
being a national historical site; the government will advertise everything i do. i currently charge $5.00 donation for those who want to come see the animals; feed them; and take pictures. while they're here; they usually buy product.
i do think the sites idea shows how the poor should be helped. if someone wants to help the poor; they have that option. the rich shouldn't be forced to help through taxes or by any other means.
sending your credit card information is the stupidest thing i've heard of in a long time. you should be able to send money orders to protect yourself from identity theft or fraud.
it sounded really dodgy from the off... i'll continue with my monthly payments to Save The Children (from Helen) which i know goes somewhere good and i'm okay with not getting my money returned.
I didnt like to say yesterday, but i dont really agree with helping people set up businesses and stuff like that.. i dont have a business and i'm damn sure nobody would give me a interest-free loan to start one... also i'm helping a business owner get even wealthier (relatively speaking) than people who are perhaps poorer in that area.... meanwhile thousands starve to death in Africa every week.
its a case of who needs it the most for me, and in my eyes thats kids... hence my monthly payment above.
but each to their own
i agree. if the recipient is starting a non profit business to help others; like food distribution; i can see it.
what i don't understand is the people who complain about all the poor and starving in the us; then send money out of the country. WTF? why wouldn't you help your own countries economy? this would eventually help you and bring you closer to the things you would like to see. like socialized medicine.
look how strong america made japan by sending them american dollars. they thanked us by imposing a 100% import tax so we can't sell our goods there.
non profit organizations are a good scam. non profit means the business doesn't make a profit. the guy that started this can pay himself $100K/year (or whatever he wants) and it's ok. he can buy a car and deduct it along with many other things.
if my surgery goes well i'll be starting a non profit organization to rebuild a pony express stage stop. it will be a "museum" open to the public but it will also have a gift shop rented to my other business which is not non profit.
being a national historical site; the government will advertise everything i do. i currently charge $5.00 donation for those who want to come see the animals; feed them; and take pictures. while they're here; they usually buy product.
i do think the sites idea shows how the poor should be helped. if someone wants to help the poor; they have that option. the rich shouldn't be forced to help through taxes or by any other means.
sending your credit card information is the stupidest thing i've heard of in a long time. you should be able to send money orders to protect yourself from identity theft or fraud.
The govt does put non-profits under scrutiny....on their tax returns, they must list the higher-paid employees, and, they must show how much income they earned on activities unrelated to the purpose of the charity. They also must show what % of the donations received actually went to the actual charitable purpose.
The govt does put non-profits under scrutiny....on their tax returns, they must list the higher-paid employees, and, they must show how much income they earned on activities unrelated to the purpose of the charity. They also must show what % of the donations received actually went to the actual charitable purpose.
joe joe joe; ever hear of loopholes? since my other company is in my daughters name; i'm renting her about 200 sq feet. what she earns in the gift shop has nothing to do with my taxes. the donations are eaten up in maintaining the property. most are cash anyway. then we have initial start up costs. fencing will be about $20K and can be depreciated over 15 years. plus; this is money i loan the organization at 10% interest and must be repaid to me.
that's the tip of the iceberg but you get the idea.
thanks hippiemom for posting this! i've read a few stories over the past year or so about this sort of thing, and it piqued my interest. i'm definitely going to look into it.
you rock, as always.
"Ladies and gentlemen, the President of the United States, Barack Obama."
"Obama's main opponent in this election on November 4th (was) not John McCain, it (was) ignorance."~Michael Moore
"i'm feeling kinda righteous right now. with my badass motherfuckin' ukulele!"
~ed, 8/7
joe joe joe; ever hear of loopholes? since my other company is in my daughters name; i'm renting her about 200 sq feet. what she earns in the gift shop has nothing to do with my taxes. the donations are eaten up in maintaining the property. most are cash anyway. then we have initial start up costs. fencing will be about $20K and can be depreciated over 15 years. plus; this is money i loan the organization at 10% interest and must be repaid to me.
that's the tip of the iceberg but you get the idea.
Well, just because there is a loophole, do you feel justified in exploiting it?
There is nothing wrong with using ethics as a guide, as opposed to doing something just because you can get away with it.
Comments
Sorry.
That just nailed it in the coffin for me.
THIS IS CRAP.
Someone is RAPING these people at 20 FUCKING PERCENT !?!
The person actually providing the funds gets JACK SHIT ... in fact, if you keep it on your card you are probably PAYING 9-28% depending on how shitty your credit card rate is.
SO ...
to recap ...
most of these loans, through a field partner ...
COST YOU 10-20% ON YOUR CREDIT CARD
EARN SOME BANKER FUCK 20% ON YOUR LOAN.
NET SUM FOR THE BANKER PIGS:
30-40% !
Think of it that way!
:( :( :(
If someone REALLY wanted to pull this idea off the "honest" way, you would say "fuck it with the "credit checks and field partners" ... do an Ebay type rating system where these people some how get commented on by other user-lenders ... "i lent him $25 and he has been paying steady, highly recommended" ... get other local indigents on the take for dollars a month (probably a huge salary for them) and have them scout out other worthy loan recipients. Hell set up a store and staff it in all these regions with locals, call it "Loans R Us" and let em walk in and apply ... it shouldn't cost 20 goddamn Percent.
or just suck it up, and acknowledge that lending small amounts to indigent folks is small potatoes, and who gives a fuck if you get your $25 back ... but the USER\LENDER would make 7-15% and NO ONE ELSE GETS RICH ... the site gets its money through advertising, good will, donations ... what ever ... but THE INDUSTRY IS FUCKING YOU ON THIS!
I'm sorry.
I can't support this idea, knowing that some "Field Partner" is pulling in 20 goddamn Percent on this! AND you are forced to use a credit card at an interest LOSS with NO upside AND its done all under the implicity grounds that the loan is ZERO PERCENT, even though the fine print states FAR TO THE CONTRARY!
It's absurd!
If I opened it now would you not understand?
see.. it doesn't say anything about your money going to a partner... it says they use partners and what the role of a partner does... but it still implies all your money goes to the loan recipient
http://www.kiva.org/app.php?page=about
Verona??? it's all surmountable
Dublin 23.08.06 "The beauty of Ireland, right there!"
Wembley? We all believe!
Copenhagen?? your light made us stars
Chicago 07? And love
What a different life
Had I not found this love with you
Verona??? it's all surmountable
Dublin 23.08.06 "The beauty of Ireland, right there!"
Wembley? We all believe!
Copenhagen?? your light made us stars
Chicago 07? And love
What a different life
Had I not found this love with you
I didnt like to say yesterday, but i dont really agree with helping people set up businesses and stuff like that.. i dont have a business and i'm damn sure nobody would give me a interest-free loan to start one... also i'm helping a business owner get even wealthier (relatively speaking) than people who are perhaps poorer in that area.... meanwhile thousands starve to death in Africa every week.
its a case of who needs it the most for me, and in my eyes thats kids... hence my monthly payment above.
but each to their own
if you're in CC debt, you probably shouldn't lend out money to someone else anyway..
you say somewhere else: Even if you are paying off your card in full, you are still losing the "Time Value" of your money.
I use CC to actually GAIN time-value...it's in effect a very short-term (few weeks) loan if you repay in full every month.
2. do YOU work for free?
3. that would help, but it's complicated tax-wise, especially as it's cross border.
I see the system more as a charitable fund to which one does not have to add all the time..
4. :rolleyes: free market is a myth! if it existed there's be no trade barrier or import duty and no financial regulation whatsoever...that'd be called Anarchy actually!
first you complain how lending without interest is wrong for the 'economy', then when told that in fact there's an interest, you rave it's unfair?!?
and drop the Credit Card..if you're dumb enough to pay that kind of rates to your bank, you shouldn't be lending money to anyone.
lastly, how, do you think regular bank lend money? they use the one you have in your accounts ..therefore making interest out of YOUR money without giving it to you..
:rolleyes:
1. Drop the personal attacks. I'm not stupid, and you don't need to go flinging insults to get your point across.
2.
a) Yes, i complained that not charging intrest would not be fair. it wouldn't, see above for that explanation.
b) Yes, i am NOW complaining that 20% is TOO much.
Here is the problem, if they came out and said straight up, "you lend money, WE charge 20% on YOUR money" i wouldn't have a problem. but the average joe is being CONNED, yes CONNED, in to believing that they are lending out their money for free. Instead you are lending YOUR money to a banker for free and he is turning around and lending it out to some poor fuck for TWENTY PERCENT? All, again, under the guise to YOU the real lender, that your loan was "free" ... That is what is stupid.
3. Yeah. Bankers take your money "on deposit" and lend it out. It's called fractional reserve banking and it has been to blame for just about every major economic problem in the modern era. The inherent problems (short term liquidity) with fractional reserve banking are the very reason 7 super-rich assholes got togeather to form the Federal Reserve System in America in the first place. I completely disagree with it. Before the Reserve was set up, banks were losing money ... why? Because tight lending policies were causing businessmen to SAVE and use CAPITAL to expand ... i'd rather see the world tighten it's belt and run on real wealth rather than spend money that doesn't exist and cause potentialy catastrophic events to occur at the expense of the people all while the banks are raping the world. Don't think it costs the people any money? Of the over $9,000,000,000,000 in Federal Debt, about $1,400,000,000,000 is a result of the Savings and Loan "scandal" alone ... i say "scandal" because it was NOT, it was a government BAIL OUT for no reason other than they promised to BAIL OUT! Just like the FDIC and the FRS. Think about it, at LEAST 1\8th of the federal debt is directly related to bad banking practice. The truth is about another 40% is DIRECTLY the responsibility of the FRS in the first place. But that's another story.
Whatever. It sounds like YOU are the one who could use some brushing up on "modern economic theory" and the truth behind those "theories" ... the truth that the only person winning at the end of the day is the ultra-rich banker fuck ... even little banks can't compete any more. Why? Because the Federal Reserve System makes it patently unfair to the little guy.
So whatever.
Yeah, i think it's crap that this site comes off as you giving money for free to someone, but the reality is the banking industry is making between 15 and 40% at the end of the day.
And my credit score is 800+ and my card rate is 7.99%
I'm not stupid, go insult someone else!
If I opened it now would you not understand?
the 20% rate is pretty well explained and totally makes sense...and they're not hiding it, the quoted text is FROM the FAQ on the website!
it's NOT a money-making scheme for the lender, it's not an investment, it's a charitable endeavour! just one where your money goes a much longer way than just giving it away once.
if you want to see it as anything else, move on!
a lot of ANY charitable donation is eaten up by the running of the charity.
the WHOLE lending principle, in any shape or form, relies on the system I described. apart from 1-1 borrowing, there's no other way it can work.
and though debt is a problem, lack of savings is one too, but you can't have savings earning any kind of interest if no-one is borrowing.
and there wouldn't be businesses without borrowing, nobody but the already rich can upfront capital, and nobody could own their home without borrowing either...
Banking crisis comes from bad lending, i.e. to people that don't repay, often because they've been lend too much at bad rates. that's the only way a bank can lose money (or speculate unwisely..which in effect is the same thing). The principle is sound, it's the greed of the banks (and their shareholders) that screws it up.
My bank is a Building Society btw..it means the clients are the shareholders and any benefit is put back in the society...that's why most of the charges are lower there than at normal banks and interests rates more competitive.
and btw, you CAN pay without a CC..Paypal in the US and the UK accepts bank transfers...or just use a bloody regular bank card ffs, not difficult!
If you choose to buy something on credit, don't blame the shop for the interest you're paying on it!
I like how you state the alternative, and then gloss over it.
The whole lending system in CURRENT shape and form relies on the pyramid scheme you implied. See bolded section for an alternative.
Bullshit. This is outright rubbish.
In fact, you only have to look to the ten years preceding the meeting at Jekyll Island (1900-1910) to tell you otherwise.
In those ten years banks were going insolvent at some alarming rates, and it had NOTHING to do with bad debt. The economy was actually doing amazingly well. The only problem the banks were having is that they were LENDING TOO MUCH, and they HAD NOTHING HELD IN RESERVE. Ok, relatively nothing ... i mean, when your outstanding liabilities outpace your assets to cover by a margin of 300-33,000% ... yeah 33,000% ... you are doomed for disaster ... that's what happens when you take ONE dollar in deposits, loan out 10 on that 1 and then take that 1 and reinvest 98 cents of it ... you are left with 2 cents to cover 10 dollars ... THAT IS WHAT THE BANKS DO!
THAT is why they used to go broke ... NOT BAD DEBT ... it was simple insolvency due to liquidity that arose directly from over extending their credit lines!
THAT is why the Federal Reserve was created in America.
That is EXACTLY why we have the current system... so BIG banks can be as wreckless as they want, and their stupidity will be covered with the backing of someone ELSES liquidity ... and then if everyone is playing stupid ... Uncle Sam will step in and fuck the tax payer with inflation (ie printing more worthless trash)! You need to read up on the history of this shit. It's scary.
Uh.
Negative, ghostrider.
Go back and read from the top.
Yikes!
You think having a dollar that is worth 8 CENTS on it's original basis is SOUND !??!
Well, i guess you got that part right.
This is like calculus ... you got the right answer, but the wrong math to back it.
The greed of the banks is INHERENT in the current system. The Federal Reserve System ENCOURAGES banks to be wreckless ... in FACT, if you AREN'T being wreckless with your lending, you are LESS likely to stay in business.
Why?
Because some other giant bank (JP Morgan Chase, or Citibank, perhaps !?!) that knows the rules (probably because their founding fathers INVENTED the rules on Jekyll Island in 1910) will use them, just as they were intended to be used.
Namely: LEND LEND LEND.
LEND TO THE BIGGEST HIGHEST INTEREST (read: RISKIEST) BORROWER YOU CAN FIND -- the Federal Government is always a SURE bet --
then, when the borrower is nearly broke, right off the loan as a loss?
Oh wait, no ... LEND THEM SOME MORE ... that's right ... ROLL IT OVER ... Federal Government Debt anyone?
Hell, LEND THEM TWICE AS MUCH!
Give 'em half to pay you interest, and half to spend more on themselves.
Then 10 years later when they are flat broke again (Federal Government?) LEND THEM DOUBLE OR TRIPLE and EXTEND THE TERMS OF THE LOAN
(hey, how would you like this as a private citizen: Oh Mr. Smith, having trouble paying your 500K home mortgage at 6% for 30 years? Oh, alright, we will refinance at 600K and put 100K in your pocket and finance the whole thing at 10% for SIXTY years!)
THAT is why banks get in "trouble".
Except, that TODAY ... THEY DON'T GET IN TROUBLE.
[unless you are a small bank lending to the common man. then uncle sam tells you to fuck off. you aren't "essential" to the system, and are expendable. only when you are one of the big boys do you get the bailout!]
They take their borrower up to Capitol Hill -- Chrysler, Penn Central [yay, we got AMTRACK out of that bullshit!], Lockheed Martin, etc -- and the banks AND their borrower PLEAD TO CONGRESS -- Oh Please Uncle Sam ... If you let us both go bankrupt, the American people will suffer ... 20,000 jobs will be lost and the Country will NEVER be the same ... YOU HAVE TO BAIL US OUT! PRINT MORE MONEY, AND GUARANTEE ME THESE LOANS ... HELL, MAYBE YOU COULD TRADE ME SOME OF MY SHITY LOANS FOR STOCK IN MY SHITY COMPANY !?!?
Grrr.
Ron Paul Learns Yuns Some
If I opened it now would you not understand?
My 11yr old son got busted at school with $150.00.
The reason the school found it was because he had shared it out in lots of 10 and 20 to all his friends (which makes me laugh with small pride) and they rocked up at the canteen flashing the cash.
It turns out he found it like he said, we havnt found the owner and we retrieved all but 40 of it, so it looks like going into the school coffers.
Gotta love parenting.
Some people pay their credit cards off each month, and if someone prefers to pay with a check, they can simply charge the loan on their credit card, and then pay that same amount on their credit card right away.
I hope most lenders are smart enough to realize that they may never get paid back. This is more of a charity, so anyone who doesn't understand the giving spirit of the program, and insists on thinking of it as an investment, will just be disappointed.
Many charities employ full-time employees who get paid real-world salaries. Paying a skilled fundraiser is done in hopes of increasing donations to the cause, and it is the norm.
If someone feels the need to collect 3% interest on say a $200 loan, that would amount to $6 of interest income per year.
I, for one, would question the compasion of someone who would insist on collecting interest on one of these loans...that would be just plain selfish!
This is, in a sense, a charitable program, yet the form of the payment to the receipient helps them learn about business, and it prevents them from feeling as if they are accepting charity. This isn't like some kids asking their parents to fund their baseball card table at a swapmeet...these are businesses that will hopefully allow the owners to earn enough money to cover basic living expenses.
That's my point.
What is with you people?
THE BANKER IS MAKING 20 FUCKING PERCENT!
And if you don't read the fine print in the FAQ, you come off first glance thinking you are loaning FREE money to these folks. Which you are NOT!
And it is NOT a charity. It is a BANK MAKING 20% OFF OF YOUR MONEY.
THE ONLY PERSON GETTING CHARITY OUT OF THIS IS THE GODDAMN BANK
That is a FACT!
In fact it isn't even 20% at that point. From a cash on cash stand point it is an INFINITE RETURN.
I just think it is stupid.
If the banks want to lend money at 20% to these damned people, they have plenty of ways to get the money. They don't need you to shell it out on credit card.
And i wish you folks would stop explaining to me how a credit card works, and how to pay it off. I get that. Duh! But most folks who donate are going to leave this on their cards. Thats just the way the world is these days.
If I opened it now would you not understand?
I am confused.......which banker makes 20% ?
Someone [Hein. Helen?] posted a quote from the FAQ on the site.
I and others were wondering if this really was interest free money that users of the site were lending ...
Helen posted a relevant section of the FAQ :
You tell me.
Is it justifiable to run a site that, on the face of it this site purports that you are lending 0% interest money to these poor people ... but if you bother to read the FAQ, you see that SOMEONE ELSE is taking 20%?
You would think that what ever money is supporting this REGISTERED NON PROFIT site would also support the lending cost of YOUR LOAN ... but NO ... in addition to whatever money this site is pulling in to operate, they ALSO tack on a 20% fee to MOST loans that YOU give out.
SO YOU TELL ME.
WHATS GOING ON?
Look.
I don't care what you do with your money.
I'm just saying i don't like the way it's structured,
and its my right to voice my disagreement with the way the site "purports" to operate from a first glance perspective ... and the way the fine print spells it out ...
which is namely ... you think you are "giving" free loans to people, but the banker is charging interest on it.
Why fucking bother with the site then.
They are really that hard up for the loan origination cash?
Why not just ask bill gates for 200,000K or something?
Surely all the 25-$1000 loans ever processed through this site cant be much more than that. Fuck it. Just give em the cash. But fuck giving MORE money to bankers.
Sweet jesus, folks!
ONCE AGAIN.
IF YOU LEND ON THIS SITE
YOU ARE DOING NO ONE ANY GREAT "CHARITY" [EXCEPT FOR THE BANKER, HE THANKS YOU PROFUSELY FOR FOOTING BOTH THE COST AND THE RISK INVOLVED IN THIS LOAN]
YOU ARE SIMPLY FACILITATING A BANK IN EXTENDING A VERY HIGH RATE LOAN TO SOMEONE WHO DOES NOT NEED TO BE BORROWING AT 20%!
EDIT:
You know what.
Fuck it.
I CONCEDE.
If these people really are only getting offers of 100-800% interest loans,
20% is great!
Fine.
I guess to me it would suck.
But i guess it is the best the "civilized" world can do to help these poor folks.
It takes some white man walking across the scorched earth of zimbabwemizakistan to collect, and he has to do this and that to ensure that Chimichuri will repay her loan and that effort as a fractional percentage of the total tiny little loan is abormaly high compared with "conventional" western loans ... fine ... i get it.
Oh well.
GO AHEAD.
USE THIS SITE.
I APPROVE.
If I opened it now would you not understand?
non profit organizations are a good scam. non profit means the business doesn't make a profit. the guy that started this can pay himself $100K/year (or whatever he wants) and it's ok. he can buy a car and deduct it along with many other things.
if my surgery goes well i'll be starting a non profit organization to rebuild a pony express stage stop. it will be a "museum" open to the public but it will also have a gift shop rented to my other business which is not non profit.
being a national historical site; the government will advertise everything i do. i currently charge $5.00 donation for those who want to come see the animals; feed them; and take pictures. while they're here; they usually buy product.
i do think the sites idea shows how the poor should be helped. if someone wants to help the poor; they have that option. the rich shouldn't be forced to help through taxes or by any other means.
sending your credit card information is the stupidest thing i've heard of in a long time. you should be able to send money orders to protect yourself from identity theft or fraud.
i agree. if the recipient is starting a non profit business to help others; like food distribution; i can see it.
what i don't understand is the people who complain about all the poor and starving in the us; then send money out of the country. WTF? why wouldn't you help your own countries economy? this would eventually help you and bring you closer to the things you would like to see. like socialized medicine.
look how strong america made japan by sending them american dollars. they thanked us by imposing a 100% import tax so we can't sell our goods there.
The govt does put non-profits under scrutiny....on their tax returns, they must list the higher-paid employees, and, they must show how much income they earned on activities unrelated to the purpose of the charity. They also must show what % of the donations received actually went to the actual charitable purpose.
joe joe joe; ever hear of loopholes? since my other company is in my daughters name; i'm renting her about 200 sq feet. what she earns in the gift shop has nothing to do with my taxes. the donations are eaten up in maintaining the property. most are cash anyway. then we have initial start up costs. fencing will be about $20K and can be depreciated over 15 years. plus; this is money i loan the organization at 10% interest and must be repaid to me.
that's the tip of the iceberg but you get the idea.
you rock, as always.
"Obama's main opponent in this election on November 4th (was) not John McCain, it (was) ignorance."~Michael Moore
"i'm feeling kinda righteous right now. with my badass motherfuckin' ukulele!"
~ed, 8/7
Well, just because there is a loophole, do you feel justified in exploiting it?
There is nothing wrong with using ethics as a guide, as opposed to doing something just because you can get away with it.