3. 3
Introduction to Microfinance
Half the world lives on <$2/day
Microfinance is the provision of financial services to the poor
Give a man a fish, feed him for a day.
Teach a man to fish, feed him for a lifetime.
What if he knows how to fish,
but just can’t afford a fishing net?
Give a man a fish, feed him for a day.
Teach a man to fish, feed him for a lifetime.
What if he knows how to fish,
but just can’t afford a fishing net?
4. 4
The Traditional Microfinance Lending Process
Microfinance
Institutions
Microfinance
Institutions
EntrepreneursEntrepreneurs
Banks and
NGOs
Banks and
NGOs
• Microfinance institutions typically get the money that they lend,
from banks or non-governmental organizations, or both
• This can be expensive, as it is often borrowed with interest
• There may also be difficult application procedures to access
debt capital from non-governmental organizations
• Some organizations can even find themselves shut out due
to the region they operate in, particularly post-conflict regions
• Restrictions that microfinance institutions face ultimately affect the
entrepreneurs, who rely on microfinance institutions to serve them
7. 7
Online lending platform
• Kiva.org is a
website which
allows you to lend
to an
entrepreneur who
needs a loan
• Through Kiva,
you loan as little
as $25 to an
entrepreneur at
0% interest
8. 8
www.kiva.org
The Kiva website lists loan
requests which you
can browse, just like
browsing items on eBay
or another website
9. 9
www.kiva.org
Size of the loan
and status
Size of the loan
and status
Summary of the
business and
loan, including
when it is
expected to be
paid back
Summary of the
business and
loan, including
when it is
expected to be
paid back
Information on
the microfinance
institution which
is managing the
loan on the
ground
Information on
the microfinance
institution which
is managing the
loan on the
ground
Picture of the
entrepreneur
Picture of the
entrepreneur
Description of the
business and
what the loan will
be used for
Description of the
business and
what the loan will
be used for
10. 10
www.kiva.org
The business page also
shows you all of the
other people around the
world who are
contributing to this loan
The business page also
shows you all of the
other people around the
world who are
contributing to this loan
11. 11
Where are we today?
Mexico
Guatemala
Honduras
Nicaragua
Haiti
Dominican
Republic
Samoa
Ecuador
Peru
Bolivia
Paraguay
Senegal
Sierra
Leone Cote
d’Ivoire
Ghana
Togo
Nigeria
Cameroon
DRC
Mozambique
Tanzania
Kenya
Uganda
South Sudan
Indonesia
Vietnam
Cambodia
NepalPakistan
Afghanistan
Tajikistan
Lebanon
Gaza Iraq
Azerbaijan
Ukraine
MoldovaBosnia
Bulgaria
Kiva has lent over $ XX dollars in loans through
XX Microfinance Partners in XX countries and is still growing
13. 15
1) Make a $25 Loan
1) Give a $25 Kiva Gift
Certificate
1) Spread the Word!
- join Facebook
- follow on Twitter
- add Kiva to your blog
4) Start a Lending Team
(join an existing team,
start your own team
with family and friends)
Get Involved Today!
14. 16
Become a Kiva Fellow!
- Work overseas with one of Kiva’s Field Partners to help
facilitate connections between Kiva Lenders and Borrowers
http://www.kiva.org/fellows
Join Kiva’s Loan Review & Translation team
- Volunteer your time remotely to help review and translate loan
profiles that are posted by our Field Partners
http://www.kiva.org/volunteer
Intern in Kiva’s San Francisco Headquarters
- Volunteer with Kiva in a part-time capacity for 4-8 months, it’s a
great opportunity to learn more about Kiva’s model
http://www.kiva.org/volunteer
Donate
Take it to the Next Level: Want to get more involved or know someone who might?
Suggested Notes:
The poor are typically excluded by financial service providers:
No collateral
No credit history
Illiteracy
The poor need financial services, and already use them informally:
Borrowing money from loan sharks with interest rates so high that it may be impossible to ever pay back
Savings accounts kept in the home, vulnerable to theft
Investing in livestock which is vulnerable to disease
Microfinance works to provide the poor with these financial services, in a safe and controlled environment, through a microfinance institution
Suggested Notes:
With Kiva, you can be micro-lender
You can act as a banker and provide the funds to microfinance institutions that they then lend to entrepreneurs
Suggested Notes:
There are thousands of microfinance institutions around the world, and they all vary a little depending on the region they are in and people they are targeting to help
Some focus on women in places where women don’t have the same rights as men and so have no economic empowerment
Some focus on the rural population in areas where people are isolated and cannot travel to cities to access services
Some focus on a comprehensive program which includes business training with financial products
What ties them all together, however, is a desire to help the poor by providing them with financial services
The Good and the Bad of Microfinance: (Optional Notes)
What are the good things about Microfinance?
With a relatively small amount of money, poor people can start or improve their business
Most formal lending institutions won’t lend to them. Why?
Microfinance can help women and girls
Microfinance works inside communities
Microfinance is empowering
Microfinance is person to person development
What are the bad things about microfinance
Takes a long time to get a loan
Borrowers have to do a lot of things to get a loan
So borrowers look for MFIs with the fewest requirements
What does this mean?
It costs a lot to give a loan, so interest rates are high
How high? Not everyone wants a business, some wish they could be an employee
*** Please fill in X’s with numbers from the Kiva Facts and History Page. Go to this link to find the latest numbers http://www.kiva.org/about/facts
Also, please, carefully read the statistics and double check that your presentation represents the correct numbers. The stats in red are responses to these facts on the Kiva website:
- Total value of all loans made through Kiva
Number of Kiva Field Partners (microfinance institutions Kiva partners with)
- Number of countries Kiva Field Partners are located in
