By Brian Kelly, KF10, Sri Lanka
Upon arriving here at BRAC Sri Lanka in February, a brand new Kiva pilot partner, I was all ready to lace up my loan posting shoes and hit the ground running. And my MFI was ready and waiting for me. BRAC Sri Lanka decided to designate two districts as “Kiva” districts and upload borrowers from these regions to the website. BRAC offers similar products within each region, so the “Kiva regions” were all set to have a reduced interest rate due to the fact that the money from Kiva to finance these loans would be arriving at 0%. However I quickly learned how ambitious our initial posting targets were, especially in months 1 and 2 in the pilot phase on the website.
Explaining Kiva to the staff of a new field partner takes time. Collecting information from the field takes time. Collecting quality information to create the story that makes a compelling borrower profile takes even more time. Then even the mechanics of uploading these profiles takes time. Hiring new Kiva-designated staff and training them takes time. I could continue, but you would stop reading. You get the picture – accumulating and posting profiles, as well as all of the other planning and implementation pieces of being a Kiva field partner can be a time consuming process with a fairly steep initial learning curve.
We have been slowly but steadily scaling this learning curve as we have gone through the growing pains of having to send profiles back into the field to follow up on incomplete information. I have spent more time than I expected trying to reinforce the point that photos have to clearly display the borrower’s face, and that they cannot be taken with a cell phone. Getting 10 profiles uploaded has turned out to be a great day. But even a perfect 10-profile-day has been falling significantly below the target to get every borrower in these two districts on the website.
Unfortunately, with the rates locked in to be the same for all borrowers across each region, this puts BRAC in a bit of a sticky situation. You have the need to properly learn all things Kiva and upload profiles correctly, which can seem picky and unnecessarily demanding to the MFI (having a high standard for pictures or needing to create an informative short narrative about the borrower). But for every borrower who doesn’t make it onto the website, the MFI doesn’t receive the 0% money that helps support the whole region’s subsidized rates.
And this is an age-old (see: 4 years) conundrum on Kiva. While the 0% money from Kiva is incredibly useful for introducing new subsidized rates or reaching out to new groups of borrowers, it puts an MFI between a bit of a rock and a hard place when it comes to forecasting because they have to assume that: 1. Their posted Kiva loans will always be funded by lenders (so far historically a pretty solid bet); and 2. That they can effectively upload enough of their borrowers onto the website in order to receive these 0% funds and make the cost savings truly worthwhile.
On the surface a Kiva partnership can appear to be a no-brainer decision for an MFI seeking an additional funding source. But there can be some risks that may not be so obvious on the face, which oftentimes present themselves to the MFI after the partnership has started – causing the need for some on-the-fly adjustments. Which is part of the challenge and fun of being a Kiva Fellow, because I can devote 100% of my time trying to solve these problems or find more efficient ways to increase our posting capacity. And I’m pretty confident that we will see a steady increase in profiles gracing the Kiva website from Sri Lanka once some of the wrinkles in the processes are all ironed out, and the staff have gotten a month or two to get the hang of using this green bubbly-icon’ed website.
Unfortunately in our case it was hard to slowly implement the partnership, we pretty much had to just unleash the firehose and say, “GO!” And that’s sometimes how it has to be, just another one of the challenges that MFIs face in the pilot phase of being Kiva field partners.
It certainly has us working swiftly to reach our goals of fully filling the Kiva districts on the website each month, an ambitious goal maybe, but one that I think we can accomplish.