Time for an update on Kiva, a charity that arranges small loans to people in eighty-four countries. Small loans but they add up to almost $1 billion. You can see some of my loans above.
You may remember that I lent $25 to a group in Kenya selling stoves. They have, finally, fessed up about why they haven’t paid me back.
This loan was defaulted on 05/31/2017, with $1,653.30 of $4,950.00 amount repaid.
In microfinance, it’s common to try to reschedule loans to accommodate eventual repayment, however sometimes loans end in default, despite efforts to be flexible. Kiva loans are defaulted at the point in time collection of future repayments is deemed unlikely, or when the loan is more than 180 days past due.
This loan is being defaulted because:
Jubilant Kenya have not been able to make any payments back on the loan due to poor financial management. They have sold stoves but they do not have the cash to pay back the KIVA loan as they have spent it on other things. As field partner we have worked with them on trying to help them with this and to come up with ways in which they could start to make repayments but this has not been fruitful.
The big picture of my loans through Kiva is more encouraging.
The magic about the Kiva model is that I have paid in $184 but I have lent $375 and this will continue to snowball. There is a similar scheme in the UK, lendwith care, and when I have sufficient data I will report on my loans through them.
https://youtu.be/nsXA-E7X_nw
Christopher – we use Lend with Care – absolutely brilliant results given that these are the people our feeble banking system won’t support. The turnaround to repayment is usually really quick which keeps your enthusiasm up as you look for new mini ventures.
I have only made three loans so far and none have started repaying so I cannot comment yet except to say that Kiva asks for a voluntary donation to cover costs while on Lend with Care it is, I think, compulsory. Anyway, Francis Plowden will be pleased with your comment; he is a trustee of LwC.
Christopher
Might be interesting to compare repayment rates between men and women. I have made Kiva loans for a long time, always to women, and have a sterling record. SMe with mosquito nets. Sell them or give them to poor families and the fathers end up with one and the others don’t. Just saying.
Well, my only default so far has been the women in Kenya who sold stoves and embezzled the proceeds.
Whoops!
Very good to hear the positive comments re Lend with Care from Anthony Glaister; I, too, have had a good success rate with my loans and their repayment. Strictly speaking, I am a not a Trustee of LwC, as Christopher suggested, but of CARE International ( UK) and LwC is one of our activities.