I'm a loan shark. Through Kiva, I've been lending money every month for the past few months to people in the third world so that they can invest in their businesses or education. I feel that it's a far better way of being charitable than just giving money. When you give money, it often gets used and then ... it's gone. And even when it does go to something useful in the long term, there's still a lot of waste. When you make a loan to help someone start or expand a business, they have something tangible at the end of it, and will be less reliant on charity and loans in the future. They can employ people too, and build up a reserve themselves to get them through lean times. And finally, when they pay back the loan, that money can go straight into making another loan, helping another person.
Making small loans for well-defined capital projects where the borrower gets something tangible at the end of it is just so much more efficient than giving to charity, and it's very affordable. By putting lenders together into ad-hoc syndicates, very small amounts of money from many lenders come together to make substantial loans.
So far, I've lent to a Palestinian who wanted to buy mics and sound mixing equipment for his radio station; to a Colombian to buy tools and equipment to set up his own metal-working business; to a Kenyan so she could buy seed to expand her farm; and to a Tajikistani student to pay for university fees.
There are, however, lots of people looking for loans on the site who don't meet my criteria, and who won't gain from taking a loan. Take this example. She wants to borrow money to buy stock for her shop, which she will promptly sell, and then be left with a debt to be paid off over 14 months. She might make a very small profit, but once she's sold it all she'll need another loan to buy more stock, and so on, a never-ending cycle of debt and interest payments. No ma'am, not gonna "help" you with that.
This is even worse. He wants a loan to pay off a loan and to buy food. This chap seems to have taken on debts that he couldn't pay off in the first place, so how can we trust him to be able to pay off the loan he's asking for? And borrowing money for food? That's just about the worst thing you can buy on credit, as you will have absolutely nothing to show at the end of it.
I really recommend Kiva - or one of the other microfinance sites. They do good work, and I don't think that any other form of philanthropy comes even close to achieving their benefit to hassle ratio. Just be careful not to invest in dependency.