Hi all.. Just testing… nothing here to see, move along now!
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Kiva is a US based peer-to-peer lending system that allows people to temporarily loan money to entrepreneurs in the developing world. Kiva acts as the agent hosting profiles of entrepreneurs for lenders to access, collecting the funds to be distributed through agencies on-the-ground, and, once a loan has been repaid, giving the funds back to lenders who can then chose to re-lend, keep, or donate to Kiva. I’ve been lending in a small way with Kiva for a little while and my experience follows that of others I talk to who boast of an exceptionally low default rate on their lending.
Kiva in the US has just announced that it will begin to allow for US based enterprises to access Kiva funds, recognising the fact that it’s not only Guatemalan agriculturalists who find access to credit difficult, so to does a Kentucky based plumber.
Here in New Zealand I was interested to read the other day that the rate that lenders charge small business for loans has hardly moved despite a massive cut in wholesale interest rates – it seems that traditional banks have little appetite for funding seemingly risky SME loans.
Even worse than the rate SMEs have to pay for loans is the bottom-line accessibility of funds. The reality is that without good collateral (generally a house) on the part of business owners, banks won’t look at SMEs as potential candidates for finance – this despite the fact that both property prices and potential to sell houses has taken a dive for the worse. And this also despite the fact that a number of applicant businesses are cash positive, have real potential, and have been trading successfully for many years.
Business owners I talk to tell of the difficulties they face securing even modest working capital – this despite the fact that, in many cases, cashflow is high and has been for some time.
The issue was raised at the job summit a few months ago, but it seems that traditional lenders have no real desire to change the systems to free the flow of capital for small businesses – it’s an issue that is close to the hearts of all the stakeholders in bizchat – after all having a place to find advice is all very useful, but without the metaphorical blood to feed the muscles of enterprise, it’s only half (or less than half) of the solution.
It’s something we’re looking at and are keen to hear from others with some time and energy to give to the cause.
Jim posted the incredible story of the New Zealand Immigration Service (NZIS) proposing a $117 million upgrade of IT infrastructure, a sum that equates, from Jim’s reckoning, to $234k per NZIS process worker.
It’s a sorry tale and one that, as Jim points out, smacks of desperation, silo building and vested interests. Given the somewhat depressing post I thought I’d revisit a success story for Government 2.0.
I’ve long been a fan of New Zealand’s Ministry of Economic Development – long before co-founding a community site for New Zealand small businesses, I was involved (and continue to be so) with economic development and advisory work for SMEs as well as running my own small businesses – in my dealings with the various branches of the Ministry of Economic Development (MED), I found them to be effective and efficient. This impression was strengthened with their wholesale adoption of modern communication channels in order to engage with their “clients”. it doesn’t matter which channel you look at – if their constituents embrace it, it’s a sure bet that the various MED departments will soon be there.
Recently I met with another Government department that I’ll leave anonymous. They’re also striving to engage with their constituents. The people I talked to were invariably passionate advocates for the enabling force that engaging with their client base can be – unfortunately their department has some silos within it, people who for whatever reason attempt to block the sort of initiatives their colleagues over at the MED embrace. The result? Frustrated staff, programmes that lack the reach they could otherwise attain and, most importantly for those who evangelise the democratizing power of Government 2.0, inefficiencies that affect the very SMEs these departments are set up to help.
So circling back to the genesis of this post – the NZIS plan for IT upgrading, I’m sure there’s some people within the service who have been flying the flag for quick and relatively economic solutions to the inefficiencies apparent in the system – and you can bet they’re blocked at every turn by anti-progressive and institutionalised individuals who can’t see past the status quo.
Shame…
Image by Getty Images via Daylife
Disclaimer – This is in no way a discussion about the David Bain case and specifically his guilt or otherwise.
That said I was a little uncomfortable to read this morning that Joe Karam, David Bain’s tireless supporter has received $330k in the past couple of years from legal aid – based on a $95 per hour rate.
When I saw the interviews with Karam and Bain post verdict, I felt a little nervous, as if Karam was carefully stage managing what Bain said and did. And then the fact that one of the defence lawyers is Karam’s son… also paid through legal aid.
Sure he’s put huge time into this fight but it all rests a little uncomfortably with me… anyone else?
