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There's No Wrong Way to Lend

One of the best parts of my job is talking with lenders – it’s a chance to understand what works well and where improvements are needed. We recently conducted a series of interviews and tested a couple of prototypes in connection with an initiative aimed at improving the way lenders find loans on Kiva. While no two lenders are the same, we wanted to share a few common patterns we've observed when it comes to how and why people use Kiva.
First a caveat: there is no right or wrong way to lend. Everybody has different values, feelings about risk and preferences. All borrowers listed on the Kiva website are deserving and making a choice based on an eye catching detail in a photo is as valid as selecting a loan because it’ll be repaid in just six months. It’s all a matter of what resonates with you.
That being said, we often hear from lenders who don’t know where to start when choosing a borrower to support. Because the process can be overwhelming we thought it'd be helpful to share a few ways we've seen lenders find borrowers they're excited to support.


As a whole, Kiva lenders are well traveled (nearly 70% have visited 5 foreign countries, including at least one developing country), so it makes sense that many have developed an affinity to a specific country or region. We often hear that international travel has affected the way lenders see the world and browsing loans on Kiva offers a window to different cultures or places. Typically, “travelers” start the process by filtering for one or two countries and then looking through photos and reading stories to find one that resonates with them. In addition, many travelers have come to love the new Collections page which makes it easy for them to find loans in each of the countries where Kiva works.
Filters for Field Partner Risk Rating, Default % and Delinquency % can be found under the advanced options on the Lend page.

Social performance badges can be found in the Field Partner info box on the right side of every borrower page.

Enlightened Investors

Many lenders see the true power of Kiva as the ability to continually recycle their funds to help more and more people. For “enlightened investors," preservation of capital (the money they deposited in Kiva) is important. This leads them to support loans with short repayment periods (4 months to 1 year) as well as microfinance partners they consider a “safe investment” – low delinquency and defaults rates (typically under 1%), and a 4-5 star rating.

Story Connectors

During a particularly heartwarming interview, a lender came across a picture of a Mexican farmer wearing a white cowboy hat turned up at the sides. The photo immediately struck a chord with her and she began to tell me about her father who wore a similar hat every day of his life. For many lenders it's all about connection—the little details found in a photo or the fact that a borrower is putting her children through school—that drives their decision to lend. Stats such as default rate or loan terms take a back seat when they see themselves or a family member in that person looking for an opportunity to improve his or her life.

Social Activists

Kiva partners with microfinance institutions and other organizations to screen borrowers, disburse loans, collect repayments and otherwise administer nearly all loans on the website. For a segment of lenders, the Field Partner is the most important factor when choosing a loan. “Social activist” lenders have a strong interest is seeing their money go towards creating long-term, positive change in communities around the world. By researching the background, mission, social performance badges and other characteristics of the partner organization, they can identify the type of innovative and meaningful work that matches their own values and passions.

We know there are countless other ways that lenders select loans, but these are just a few of the patterns we’ve observed in recent lender interviews, and we're really interested to keep learning from our lenders about why they make the loans they do. Do your habits match one of the patterns above? Or, do you have other criteria? Let us know in the comments.
One last thing—it takes a lot of time to set up interviews, and we've been lucky to have the support of WatchLab helping us with many of our interviews. They’ve been invaluable in finding us the right people, scheduling their interviews and providing an ideal location to have a relaxed conversation. Thanks, San Francisco WatchLab!


About the author

Abe Wallin

Abraham has long believed in Kiva’s mission of addressing global poverty by creating relationships between individual lenders and borrowers. In 2011 he joined Kiva as the company’s first full time designer. He brings with him a steadfast belief that constantly creating is as important to humanity as eating and drinking. Prior to joining Kiva he worked at Electronic Arts, Wikia and as a freelance web and interactive designer. With over a decade of experience Abraham has designed and built a wide range of products including websites, video games and mobile applications. He most recently launched an iPhone app for fruits and vegetables called Farmanac.