Flyertalk member Rommie2k6 offers this warning to folks using Kiva.org as a way of earning points, or meeting minimum spend requirements for credit card signup bonuses.
I’ve been aware that FTers are using Kiva to manufacture spend or generate points…
..I would warn all FTers that there is a risk in doing these kind of Kiva spends. Even if some of you have done your due diligence, and find that the company backing Kiva is financially sound and a legitimate operation there is always a possibility that Kiva can close down overnight. I strongly doubt that Kiva or its parent company has any credit rating, so Kiva loans are going to be akin to junk bonds. If a default happens for whatever reason, I would expect that all outstanding “loans” will be something that FTers will not get back, not without a costly and long drawn out litigation…
Since paypal subsidizes the credit card transaction fees for Kiva, you can load money with a credit card (as a purchase) onto a Kiva account. Then make loans, and when those loans are paid back (there are no guarantees!) you can withdraw the funds instead of making new loans.
The cost here is borne primarily by paypal, miles are generated, and microloans are made to help the poor.
But this is far from a riskless activity, indeed. There’s the risk that a loan defaults, you don’t get paid back. There’s risk that Kiva’s rules could change, and risk that you’re relying on Kiva’s financial stability. I’m not suggesting these are enormous risks, probably the repayment risk is the biggest (and Kiva’s repayment rates are very high). However, folks trying this certainly could be left with big credit card bills and without the funds available to pay those bills.