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Catalytic Loans: How Kiva is pushing boundaries to make loans do more

When we think about impact at Kiva, the first thing that comes to mind is the effect loans have on borrowers’ lives. From a shopkeeper in Rwanda paying back her loan successfully to a farmer in Nicaragua putting his kids through school, it’s clear that Kiva loans are changing lives each and every day.

Of course none of this would be possible without our 170+ field partners around the world. So when it comes to reaching even more borrowers with the right loans and services, we also need to enable change at the partner level. How do we plan to do this?

First and foremost, we want to support good institutions, so that they can grow their core offerings and serve more people. These core partners work to achieve what we call breadth of impact. Our social performance scoring process helps ensure that we pick good organizations, and that we give them credit for the work they do. 

This is how we end up partnering with remarkable organizations like People’s Forum in India, which earned 7 out of 7 of our social performance badges. Or why we opted to work with Solar Sister, a social enterprise that distributes clean energy technology and empowers women at the same time.

Kiva borrower Manas lives in the poorest part of India. He borrowed $550 through People's Forum to grow his carving business and build a brighter future for his young daughter. As you can tell, his mother is pretty proud.

Kiva funding is incredibly unique -- and we owe that to you, our lenders. You provide funding at 0% interest -- essentially for free and at flexible terms -- and we want to make sure that we’re putting it to work to make the most impact possible. With Kiva funding covering loans, our partners are able to free up their own operating funds to push the boundaries of what they can do, like offer health care and insurance services, work in remote areas, introduce new loan products and more.

This is how we’re striving to achieve depth of impact.

On the depth side, we’re helping our partners reach into new areas, innovate and expand their offerings in what we call the four Ps: populations, products, places and prices. Here’s what we hope to achieve:

  • Populations - Enabling partners to use Kiva funding to help expand to new populations, especially those that are marginalized or excluded from financial services.
  • Products - Enabling partners to use Kiva funding to offer new products that promote or enable social causes, like loans for solar lighting devices, or to pay college tuitions.
  • Places - Enabling partners to use Kiva funding to expand to new geographic locations, especially areas where there are few options for accessing loans.
  • Prices - Enabling partners to use Kiva funding to drive down the cost of loans for clients.
With this support, we’re seeing more and more partners develop new types of loans that take all of this into account. Loans that provide the right products and services to the people who need them most. We consider these loans to be “catalytic” -- demonstrating positive change in Kiva’s portfolio and around the world.

When you see a partner like Fundacion Paraguaya offering loans for clean water pipelines and solar lanterns, or XacBank in Mongolia providing home improvement loans, you should know that Kiva lenders are the ones helping them innovate, and take chances with new, life-changing ideas. 

This is Tsetsegmaa outside her traditional ger house in Mongolia. She took out a $500 loan through XacBank, which specifically targets residents in ger districts that lack electricity, piped water and other infrastructure.

Today, you can find most of these loans by clicking on the featured categories at the top of the lend page, or checking boxes under the “Attributes” heading in the sidebar. We hope you’ll take some time to explore these options.

These catalytic loans currently make up about 20% of Kiva loans. This is the first year we’re tracking them closely, and we’ll be working hard over the coming months to increase this figure dramatically -- all in the spirit of serving more borrowers, better.

Have questions about catalytic loans? Send them our way at

About the author

Michelle Kreger

Michelle is responsible for overseeing Kiva's expansion into new impact areas including clean energy, water and sanitation, innovative agriculture and higher education.  As Kiva matures, these areas are increasingly relevant to Kiva's work as we focus on expanding our impact to include environmental sustainability and equal access to opportunity in addition to financial inclusion.  Michelle began her career at Kiva in 2006 on the investments team, spending three years building Kiva's work in North, Central and South America.   After that, she shifted her focus to West Africa and the Middle East, where she spent a few additional years building solid partnerships and an all-star regional team.  In late 2011, she moved into her current role as the Director of Strategic Initiatives.  Prior to joining Kiva, Michelle founded a non-profit organization in Costa Rica, NatureKids, which is focused on English literacy and environmental sustainability in burgeoning tourist hubs.  She also worked at various organizations dedicated to financial inclusion, including ACCION International.  Michelle graduated magna cum laude from Boston University with a degree in International Relations and a minor in Economics.