Kiva

Kiva Conference Call Notes

wiseclerk

Live from the Kiva Conference Call:

  • Defaults: FSME and Health Africa ceased to exist. Ebony Foundation loans were defaulted because Ebony failed to repay
  • There are payment problems with 2 providers
  • Eastern Europe portfolios are hard hit by economic downturn. 3 partners are problematic
  • Future plans for research project on alternative ways to display loans on the site (e.g. dashboard) – see related ‘popularity issue‘ discussion here
  • MFIs are working on updates on the impacts of recent Tsunamis (Samoa, Philippines) – will come in the next weeks.
  • Q&A touched transparency – one question was how much can be revealed on the homepage and how much needs to be one click away on the help page (e.g. descriptions on processes like net billing)

Topics on the Kiva Conference Call

wiseclerk 1 Comment

Today was another conference call by Kiva with its lenders.

Kiva informed about the situation of Fundación San Miguel Arcángel (FSMA), a field partner in the Dominican Republic, who is unable to repay lenders and will soon cease operations.

On the question, why Kiva does provide fewer translations, Kiva explained that they have a hard time to find enough volunteers to translate all texts. Another factor is the limited availability of engineering time to improve features related to translation.

Kiva decided in August to not provide translations to English for some loans. In this “non-translation experiment” Kiva will try to measure the effect of omitting the translation on the funding rate and speed.

In the discussion on the currency risk Kiva asked for feedback from the lenders on which information should be presented. One suggestion was to make the information that a currency risk may occur more eye-catching in the loan selection. Consensus was that currency risk information is more important for “power” lenders than occasional, infrequent lenders.

One third of the time of the engineers is spend on MFI and volunteer related issues. One third is spent on lender related (interface, features) issues. One third is spend on maintenance, bug-fixing, system issues.

Conversion rate: Of 100 people visiting the website, 8 make a loan.
40 percent of the people who put something (loans) in the basket, do not complete the check-out.

Kiva Enacts Currency Risk Changes

wiseclerk

Kiva has now enacted changes in how currency risks are accounted for. The model was first proposed in March.
Now MFIs can choose “currency risk protection” for their new loans. If this option is selected lenders will have to cover any losses that arise from a devaluation of the local currency exceeding 20% (for the part that is over the 20%).

On listed loans at Kiva there will be a new information status on the “about the Loan” Section under “Currency Exchange Loss”. The status will either be:

  • “Covered”: Meaning the MFI covers any losses (like it has been in the past)
  • “Possible”: The MFI has opted for the new rule – the lender covers currency losses above 20%

I browsed some new loan listings today – most are still offered under the “covered” rule, one example of a loan under the new “possible” rule is this Tajikistan loan. Continue reading →