5 ms·

Kiva is matching loans for first time donors

58 points by ByteMuse 15y ago

clloyd 15y ago
If they have faith in the system, then surely this should cost them next to nothing as everything should be repaid? (Although I'm naive on the accounting of things like this.) Great idea though, never lost a $1 through kiva lending.
- knight99 15y ago
  Looks like kiva has 98.87% repayment rate, so a small price to pay to attract new users. http://www.kiva.org/about/risk/overview http://www.kiva.org/about/risk/overview
- sgk284 15y ago
  Yep, same here. I've done several loans and always have gotten repaid. Great service.
eekfuh 15y ago
Brilliant idea. (i just did my first loan with the matching loan.)
cjg_ 15y ago
A few months ago you could do a trial $25 loan with their money. Guess matching loans is better though.
waitwhat 15y ago
Something people should be more aware of regarding Kiva... Ignore the pictures of the people you are purportedly lending to, their projects, and even their country. That is pure marketing. If you read the small-print http://www.kiva.org/about/how/even-more http://www.kiva.org/about/how/even-more you will see that you aren't lending to these people at all, but actually making zero-interest, low-risk, short-term loans to micro-finance institutions. (That said, I do have a couple of hundred dollars in Kiva myself.)
- nodata 15y ago
  That's not quite true is it - if that person defaults you lose your money. It's similar to switching electricity suppliers (stay with me!) - you don't get a new cable straight from the electricity company which carries only "their" electricity, you stick with the same cable and the same electricity but more of your supplier's electricity gets bought.
  - delinka 15y ago
    He said "low risk" not "no risk." Low risk indicates that there's still some risk that you'll lose your money. I have no idea what that has to do with electricity supoly lines.
    - nodata 15y ago
      My point is that you are lending to individual people since you lose money when they default on their loan. (Electricity supply lines: say you sign up for "green" electricity. Nobody comes and physically cables you up to a separate grid, you just pay for more green electricity and all the different companies work it the numbers behind the scenes. Similar to what waitwhat is saying)
  - waitwhat 15y ago
    That's not quite true is it - if that person defaults you lose your money. Actually, it's your assertion that is not quite true. It certainly used to be the case that "We give Field Partners the option to cover [...] entrepreneur defaults." [1] And there was indeed evidence at the time that Field Partners were doing just that. [2] Although they have removed this explicit wording, it isn't clear that doing this is no longer allowed, and there is some evidence that the practice is continuing: Only 7 out of 128 pilot or active Field Partners report a default rate of more than 1%; indeed, around three-quarters of them report a default rate of 0.00%. [3] Frankly, these statistics are unbelievable unless we accept that most Field Partners still cover entrepreneur defaults. So if the end-borrower defaults, you might lose money. But rather more likely is that the Field Partner will cover the loss themselves as an operating cost, not report any of this to Kiva, and you will be none-the-wiser. [1] http://web.archive.org/web/20091117123031/http://www.kiva.org/about/how/ http://web.archive.org/web/20091117123031/http://www.kiva.or... [2] http://blog.givewell.org/2009/10/13/kiva-repayment-data/ http://blog.givewell.org/2009/10/13/kiva-repayment-data/ [3] http://www.kiva.org/partners http://www.kiva.org/partners

58 points by ByteMuse 15y ago

If they have faith in the system, then surely this should cost them next to nothing as everything should be repaid? (Although I'm naive on the accounting of things like this.) Great idea though, never lost a $1 through kiva lending.

knight99 15y ago
Looks like kiva has 98.87% repayment rate, so a small price to pay to attract new users. http://www.kiva.org/about/risk/overview http://www.kiva.org/about/risk/overview
sgk284 15y ago
Yep, same here. I've done several loans and always have gotten repaid. Great service.

eekfuh 15y ago

Brilliant idea. (i just did my first loan with the matching loan.)

cjg_ 15y ago

A few months ago you could do a trial $25 loan with their money. Guess matching loans is better though.

waitwhat 15y ago

Something people should be more aware of regarding Kiva... Ignore the pictures of the people you are purportedly lending to, their projects, and even their country. That is pure marketing. If you read the small-print http://www.kiva.org/about/how/even-more http://www.kiva.org/about/how/even-more you will see that you aren't lending to these people at all, but actually making zero-interest, low-risk, short-term loans to micro-finance institutions. (That said, I do have a couple of hundred dollars in Kiva myself.)

nodata 15y ago
That's not quite true is it - if that person defaults you lose your money. It's similar to switching electricity suppliers (stay with me!) - you don't get a new cable straight from the electricity company which carries only "their" electricity, you stick with the same cable and the same electricity but more of your supplier's electricity gets bought.
- delinka 15y ago
  He said "low risk" not "no risk." Low risk indicates that there's still some risk that you'll lose your money. I have no idea what that has to do with electricity supoly lines.
  - nodata 15y ago
    My point is that you are lending to individual people since you lose money when they default on their loan. (Electricity supply lines: say you sign up for "green" electricity. Nobody comes and physically cables you up to a separate grid, you just pay for more green electricity and all the different companies work it the numbers behind the scenes. Similar to what waitwhat is saying)
- waitwhat 15y ago
  That's not quite true is it - if that person defaults you lose your money. Actually, it's your assertion that is not quite true. It certainly used to be the case that "We give Field Partners the option to cover [...] entrepreneur defaults." [1] And there was indeed evidence at the time that Field Partners were doing just that. [2] Although they have removed this explicit wording, it isn't clear that doing this is no longer allowed, and there is some evidence that the practice is continuing: Only 7 out of 128 pilot or active Field Partners report a default rate of more than 1%; indeed, around three-quarters of them report a default rate of 0.00%. [3] Frankly, these statistics are unbelievable unless we accept that most Field Partners still cover entrepreneur defaults. So if the end-borrower defaults, you might lose money. But rather more likely is that the Field Partner will cover the loss themselves as an operating cost, not report any of this to Kiva, and you will be none-the-wiser. [1] http://web.archive.org/web/20091117123031/http://www.kiva.org/about/how/ http://web.archive.org/web/20091117123031/http://www.kiva.or... [2] http://blog.givewell.org/2009/10/13/kiva-repayment-data/ http://blog.givewell.org/2009/10/13/kiva-repayment-data/ [3] http://www.kiva.org/partners http://www.kiva.org/partners