This came up a couple of weeks ago. As you may know, we’ve been supporters of Kiva since last year when we made a loan. In early June, we got an email notifying us that the loan was officially in default. This means that we were definitely not going to see the unpaid balance of the loan.
By itself, this is no big deal to us. We entered into this with a small sum and with the understanding that this could happen. Kiva has historically maintained a very low default rate, so this was a rare thing.
Except for this: the reason for the default wasn’t necessarily the borrower, but rather the field partner that actually manages the loan. Kiva works with a number of these partners, most of which are yet in very good shape.
This one, however, had experienced some major setbacks, both in leadership (the founder and president passed away recently) and appropriate handling of money. In other words, they mishandled their money. Kiva is working toward trying to recover the money, but it’s not likely that they will be very successful.
The organization in question is Women’s Economic Empowerment Consort. We were attracted to this particular partner because of their focus on helping build businesses owned by women. We believe this is so vital in parts of the world where women are still considered second class citizens.
Anyhow, this should not been seen as a blemish on Kiva. They have provided some good information on the situation and have been very responsive to questions.
We will continue to support Kiva, and we encourage you to consider how you can have a direct impact on the lives of people in impoverished parts of the world who are not looking for a handout, but just a small loan to help build up a business and can themselves provide a valuable service to their community. By making these small financial investments we can help grow more people to become self-sufficient and build up their young economies.
