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P2P lending as a new trend in philanthropy

The Boston Herald today cites peer-to-peer lending as a modernizing force in the ancient practice of charity. At a time when the need for non-profit services is higher than ever, direct financial exchange between individuals is emerging as a critical way to connect the haves and have nots. The article explains:

"The Internet has also spurred on peer-to-peer exchange, a movement that has changed the way people think about charity. Many donors – particularly in younger and more progressive demographics like the Boston area – want to feel connected to the people to whom they’re giving, want to understand the specific need and how their gift will impact the recipient.

Sites such as GlobalGiving, DonorsChoose and Kiva allow donors to select a charitable project by topic (children, animals, climate change), geographic region (Bosnia, Zimbabwe, Guatemala), or specific project (classroom supplies, skills training, vaccines). This customized giving has made it possible to help others in ways not imagined just a few years ago."

Research suggests that people give to charity because they want to give back and to feel connected. Internet P2P venues offer an incredibly easy way to make those connections and to make a difference through sums as small as $25 loaned to a entrepreneur through Kiva to as large as you want to provide to help public schools through DonorsChoose. As the article states, charity is also big business --Giving USA puts the 2007 total at over $300 billion-- suggesting that p2p lending platforms have plenty of space to grow.

Flickr Credit: Benevolink


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