1) It all starts with our Field
Partners, which are microfinance institutions operating around the
world. Our Field
Partners approve and disburse a microloan to an entrepreneur in their
community. They take a picture of the entrepreneur and write
down the entrepreneur’s story.
2) The Field Partner uploads the
entrepreneur’s profile to Kiva’s website. The profile, if it’s not in
English, is translated by one
of our hundreds of volunteer translators. After translation, the
profile appears live on Kiva.org
3) Lenders like you browse the
entrepreneurs’ profiles and choose someone to lend to, using PayPal or
their credit cards.
4) Kiva provides the funds to our
Field Partners by aggregating the loan funds from all contributing
lenders. Most Field Partners
then use the Kiva lender funds to backfill the loan they’ve already
disbursed to the entrepreneur. Disbursals can happen up to 30
days before, or 30 days after a loan request is uploaded to the Kiva
website.
5) Over time, the entrepreneur
repays her loan. The Field Partner collects those repayments and lets
Kiva know if a repayment was
not made as scheduled. We give Field Partners the option to cover both
currency losses and entrepreneur defaults.
To speed things up and to minimize the number and expense of wire
transfers, Kiva works on a net billing system. This means that,
for any given month, we subtract the amount of repayments that a Field
Partner owes to Kiva lenders from the amount that a Field
Partner fundraises for entrepreneurs on Kiva.
If the balance is positive, that means that the Field Partner has
raised more than they need to repay, and we use those funds to
credit your lender account with the repayments due to you.
If the balance is negative, then the Field Partner has 30 days to send
us a payment for the balance. As soon as we receive that
payment, we use those funds to credit your lender account with the
repayments due to you.
Repayment and other updates are posted on Kiva and emailed to lenders
who wish to receive them.
6) When lenders get their money
back, they can re-lend to another entrepreneur, donate their funds to
Kiva (to cover operational
expenses), or withdraw their funds to their PayPal accounts.
