Micro-Grants, in Person-to-Person fashion: DonorsChoose.org

DonorsChoose.org facilitates privately-funded Micro-grants benefit students in the classroom. The non-profit was founded in 2000 by teachers in the South Bronx as a way to help support their classrooms.

The platform allows donors to choose the classroom and project that they would like to fund. From literacy and music programs, all the way down to “we need more pencils.” Donors can contribute any amount they want to support these classroom projects.

Prospective donors can sort by the urgency, geographic location, academic subject or even the poverty level of the school program they would like to support.

DonorsChoose has received a four-star rating from Charity Navigator, and 86% of their income directly supports programs. Also, their nearly $16,000,000 budget is entirely supported without government support—driven only by donors.

If a program is not fully funded by the date the funding is needed, the money is returned to the donor, who can reinvest it in another project.

Jessica Ward is a freelance writer and blogger in Seattle. She also blogs at http://www.pennywisefamily.blogspot.com/.

Kiva Adds Currency Risk Protection

I recently read Banker to the Poor by Muhammad Yunus, and was surprised that one of the primary barriers to stability in the microfinance business is currency fluctuations between countries.

It makes sense that the countries most vulnerable and in need of microfinance are often the countries at the greatest risk for fluctuations.

That of course got me thinking about my own Kiva Account. Would my paltry $25 be there to re-loan when the loan was repaid?

It doesn’t surprise me to see that Kiva has already thought about that. In June, Kiva.org launched a currency risk protection tool to better protect Kiva Borrowers against fluctuations in their borrower’s native currency.

The tool works by limiting the foreign currency risk for field partners to a devaluation of 20%. Any amounts beyond that is shared by Kiva lenders, if the field partner organization has selected to use the currency protection tool.

Next time you fund a Kiva loan you can check on this by viewing “About the Loan.” In the section there is a label titled “Currency Risk” and there are three risk statuses.
1. Covered: If the field partner has not opted in to the risk sharing program.
2. Possible: if the field partner has opted in to risk sharing.
3. N/A: if the partner doesn’t need to take risk precautions as they disburse loans in US Dollars.

Jessica Ward is a freelance writer and blogger in the Seattle, WA area. She writes on family, money and business. You can learn more about her projects at www.jessicaward.me

Paying for college the peer to peer way

With Fynanz exiting the US student loan market earlier this month there’s still room in the student loan market for a peer to peer player.

Lending Club requires a swift three-year repayment, and the interest is higher than some commercially-available student loans. Some students may want to turn to Greennote as a funding option. Greennote.com has a fixed interest rate of 6.8% and doesn’t require citizenship or a co-signer. (Prospective investors, take note.) Greennote is backed by Menlo Ventures and is based in Redwood City, CA. They launched in June 2008.

Another alternative for students is a mico-grant program found at CollegeDegreeFund.com. Students establish a profile and companies and individuals can provide a sponsorship of any amount towards his or her needs. Funders can contribute as little as $1.00. This is not an investment program, but a micro-grant program of essentially free money for college students. I’ve sent an e-mail off to the managing partners to see how many sponsorships have been funded so far as they reach the one-year mark of operation and I will update here when I hear back from them.