#1
Kiva Adds Student Loans To Microlending Marketplace

Kiva.org, one of the pioneers in micro-lending to entrepreneurs, is entering the educational space today, launching the pilot program of student microloans on the platform.

Kiva is a peer-to-peer lending site that began as a way to facilitate micropayment loans between citizen lenders and extremely low-income entrepreneurs in developing countries, Through Kiva’s platform, anyone can loan $25 or more to support an entrepreneur and the specific progress of the loan can be tracked from initial funding to repayment. Upon receiving repayment, lenders can withdraw their funds from Kiva or lend again to another entrepreneur, thereby continuing the lending cycle.

Most of the entrepreneurs who benefit are in developing countries, but last year Kiva opened up its service to needy U.S. entrepreneurs last summer (which caused some controversy). It also has APIs for other developers to build on its data set.

With the Student Microloans program, now anyone can lend as little as $25 to students in Bolivia, Paraguay and Ecuador to to fund their educations. Similar to the way the organization handles its small business loans, Kiva is working closely with its Field Partners in the three countries to find students and to create a loan offering tailored for the countries’ students. In some cases, Kiva is providing the additional reach needed to fund its current portfolio of student loans and, in another case, Kiva’s partner is creating their first ever student microloan offering.

As with other Kiva loans, the progress of the loan can be tracked from initial funding to repayment. Typically, students have between one and three years to pay back their loans. Upon receiving repayment, lenders can withdraw their funds or re-lend to another student or entrepreneur.

For example, Alicia Fructos, a student from Caaguazú, Paraguay is using Kiva to help fund her education (pictured below). From her lending page on Kiva’s site:

Alicia Frutos is from the city of Caaguazú. She is 23 years old and in her fifth year studying Legal and Notary Sciences at Universidad del Norte in Caaguazú. Alicia has a 22 year old sister who graduated with a degree in Accounting from the same school. Her mother has a business renting out tables and chairs for social events, while her father works as a merchant. Alicia currently works as a registrar at the courthouse, where she is gaining experience while earning an income to help pay for her studies. She is eager to finish her degree so that she can open her own law practice, grow professionally, and be recognized for her excellent work as a lawyer. Alicia is requesting a loan to pay her monthly tuition. Since she is seeking to complete two degrees, the cost is quite expensive.

Kiva has been growing like a weed since its launch in 2008. Currently, over 477,000 people have loaned more than $150 million to 408,000 entrepreneurs in 53 countries via Kiva. Kiva’s repayment rate thus far (for entrepreneurs) is 98 percent and the startup is raising $1 million every 5 days for small businesses.

The move to help fund student loans in developing countries seems seems like a natural transition for Kiva, but CEO Premal Shah reinforces this is still a pilot program and the startup is still waiting to see how the program fares before extending it to other countries.

Of course while Kiva pioneered the model of using microlending to fund small businesses in developing countries, another startup, Vittana, launched its microlending marketplace for student loans last May.



http://techcrunch.com/2010/09/20/kiva-adds-student-loans-to-microlending-marketplace/
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#3
98% repayment holy fuck these guys are good.
#4
hello paraguay police? my kiva borrower got pregnant after graduating and missed a payment so she could buy diapers. as you know, that was her decision to keep her crotchspawn instead of getting an abortion and a job. is there some way you can arrest her and sell the baby? if possible, i will accept repayment in the form of fiery fatty jerky, as recommended to me by the law-talking lounge. yes i will hold.
#5
oh this is a 2010 article, they are rolling it out in england now apparently

flappoed again
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#8
http://www.towardfreedom.com/home/americas/2898-a-coup-over-land-the-resource-war-behind-paraguays-crisis
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#10
kiva's 98%+ payback rate is baffling and i don't understand how they do it.
#11

Goethestein posted:

kiva's 98%+ payback rate is baffling and i don't understand how they do it.

they must screen the shit out of people or force them to put their daughters up as collateral or something

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#13

Goethestein posted:

kiva's 98%+ payback rate is baffling and i don't understand how they do it.



i would suspect that something like this very quickly ends up being about 98%+ international drug money laundering

#14

stegosaurus posted:

Goethestein posted:

kiva's 98%+ payback rate is baffling and i don't understand how they do it.

they must screen the shit out of people or force them to put their daughters up as collateral or something



screening people only goes so far. i'd bett that more than 2% of mercedes sales end up in some manner of default

#15
there are two reasons they get high repayment numbers. one reason is that there is an intermediary. kiva deals with loan agencies. these loan agencies charge interest and are pretty keen on getting their money. there are cases where they agencies basically find ways to harass you or take your stuff to get payment.

the other reason the numbers for repayment are high is that well they aren't real numbers. basically they create a bunch of other categories other than default. so like if you don't pay then maybe you'll be put into a special loan extension category or something. one thing a lot of agencies do is cycle through the debt. like often people get microloans for bogus purposes and then use the money to pay for living expenses and maybe to pay old loans. so you might get one microloan to pay off another, which keeps the repayment numbers high.
#16
the new thinking for some aid agencies (like oxfam) are micropayments. like you show up with a business plan and then they give you like $25 and you go off and buy some bike repair tools so you can start a repair business or whatever. but you don't have to repay it, you just sort of promise to stay engaged and help other new businesses and such. this seems better than loans, even though it doesn't address structural inequalities.
#17
i remember when people on LF loved Kiva and i asked why not just donate money to organizations to address problems of available capital and they said loans were better because they would get their money back and could then reinvest it in helping and i pointed out that you can claim effectively 100% of charitable donations on your taxes and thus get the money back, and they went bluuugh
#18
even if you insisted that it be an investment, there are a lot of simpler ways to do it. like most places have index funds that target certain kinds of social-purpose projects and sectors. a lot of them get large tax benefits in various ways too. hand-selecting single small projects with almost no relevant information is a terrible idea. plus most of these people probably have debt which means they are borrowing money from a bank in order to front some loans in mexico or something which makes no sense.
#19
yes i am sure that Ethical funds that a bank hooks you up with are all totally legit all the way down the pipe and none of the money goes to anything shitty. the invisible hand ensures this
#20

drwhat posted:

yes i am sure that Ethical funds that a bank hooks you up with are all totally legit all the way down the pipe and none of the money goes to anything shitty. the invisible hand ensures this

i said that if you insisted it be an investment. also obviously yeah most ethical funds are garbage but some are probably better than kiva, given that kiva is just like investing in debt recovery agencies.

#21
but yes if i have to fight to defend the financial sector, i will, because every day it delivers value for american customers.

*kata*
#22

Goethestein posted:

i remember when people on LF loved Kiva and i asked why not just donate money to organizations to address problems of available capital and they said loans were better because they would get their money back and could then reinvest it in helping and i pointed out that you can claim effectively 100% of charitable donations on your taxes and thus get the money back, and they went bluuugh



you have to pay taxes for a tax refund to be of value

#23
and even then then they're only equal in value to your top tax rate. GAH
#24

shennong posted:

Goethestein posted:

i remember when people on LF loved Kiva and i asked why not just donate money to organizations to address problems of available capital and they said loans were better because they would get their money back and could then reinvest it in helping and i pointed out that you can claim effectively 100% of charitable donations on your taxes and thus get the money back, and they went bluuugh

you have to pay taxes for a tax refund to be of value



dats fukken gay