Starting now, Kiva lenders can make loans as small as $25 to Indian borrowers across sectors. To make this happen, we've worked tirelessly to partner with organizations that are bringing economic opportunity to some of the most remote, vulnerable and excluded populations on the planet. These are loans that will definitely change lives.
An introduction to Kiva in India from President Premal Shah:
An introduction to Kiva in India from President Premal Shah:
With more than 32% of India's population falling below the international poverty line and 68% living on less than US$2 a day, the country is in dire need of responsible, affordable sources of capital. India has a complex history with microfinance, leaving many financial institutions unable or unwilling to serve poor and socially-excluded borrowers.
Recognizing this need and opportunity, Kiva wanted to give the global lending community a simple, ethical channel to support India's most geographically-isolated, underserved and vulnerable groups. These groups include widows, the disabled, leprosy-affected families and many more who have had virtually no chance at making a sustainable living for themselves before now.
So today, we're not only announcing the launch, but also three new exciting Field Partnerships with client-centered, community-based nonprofits that will make sure Kiva loans go where they're needed most. All three operate in regions with a low-concentration of microfinance services, and all three have been carefully vetted to ensure that their policies, practices and community ties put the needs of their clients first.
These nonprofits include:
1) People's Forum is a nonprofit organization based in the state of Odisha. In addition to microloans, it also offers clients a range of beneficial services, including programs for mental health, elementary education, support for survivors of human trafficking, drought mitigation and health awareness.
People’s Forum is dedicating Kiva-funded loans to expand and launch finance programs for widowed women, disabled individuals, and families affected by leprosy, in particular. These demographics are usually neglected and seen as "high risk," making them perfect recipients for Kiva's patient capital.
2) Mahashakti Foundation, also based in Odisha, provides clients with an array of services from business training and microcredit to community development, fair price pharmacy services, food security, support for farmers, and loans for clean water and sanitation infrastructure.
3) WSDS is a well-established nonprofit based in Manipur, a very remote region in northeast India. The organization is distinguished by lending to women over age 55, which is unusual for microfinance institutions in India. It also offers clients credit to purchase solar lamps.
WSDS will use Kiva loans to expand existing client programs and to pilot new loan products that other institutions and investors typically won't fund.
We couldn't be happier to expand much-needed opportunity in this part of the world. But determining how to work in India wasn't easy. In particular, Kiva loans are subject to Reserve Bank of India regulations that require loan funds sent to non-government microfinance institutions to remain in the country for at least 3 years.
Fortunately, we’ve figured out a way to work with these rules. Our Field Partners will simply hold on to loan funds for the minimum 3-year term before sending repayments back to lenders. The borrower you select will probably repay beforehand, in which case your funds will be recycled to help other local borrowers -- maximizing your impact before your funds are returned. (Learn more about this here.)
We know this is a bit different from the typical Kiva lending experience -- and we definitely want all our lenders to be aware of the differences before clicking "Lend" -- but, to us, the trade-off seems more than worth it considering the number of lives that could be touched by Kiva loans. We can't wait to see it happen.
Have questions? Comments about lending in India? Send them our way at blog@kiva.org.
