Kiva: Crowdsourced Loans for Small Businesses in Durham
What is Kiva?
Kiva was established in 2005 as the world's first micro-lending website. It operates through crowdfunding - like GoFundMe! The difference is, Kiva allows everyday people to contribute small loans to fund businesses all around the world.
Kiva allows lenders to see the real impact of their investment on small businesses. For borrowers, Kiva is the first step on the capital ladder, and will open doors for new and/or underserved businesses that may be denied access to traditional loans.
How does it work?
The process will only take 30 minutes - 1 hour! In addition to a few financial questions, you will also need to provide a high quality photo, a personal story, and business story.
2. Kiva review
Kiva reviewers will take 1-3 weeks to determine a borrower's eligibility and loan size.
For up to 45 days, you will work to crowdsource the funds for your loan. This takes place over two periods:
I. Private Fundraising: For the first fifteen days, borrowers invite friends and family (5-40 people) to support them with loans as small as $25.
II. Public Fundraising: Then, borrowers will have an additional 30 days to fundraise from Kiva's global network of lenders.
Once the fundraising goal is complete, there will be a 1-6 month period before repayments must be made. Then, the loan will be repaid monthly via paypal over a term of 12-36 months.
Carolina Community Impact has all the resources you need to become a successful borrower, lender, or trustee through Kiva. Visit CCI's website to get connected!
- What kind of information will the Kiva reviewers look for?
Kiva borrowers need to clear a few basic financial thresholds, such as debt : income ratio, as well as provide proof of their business.
Reviewers also may check to see if applicants have been endorsed by a Kiva Trustee, made a loan to another Kiva borrower, or have an online presence for their business - but these are not requirements to be eligible.
- What are the eligibility requirements?
- Age 18 or older
- Using the loan funds for business purposes
- Located in the USA
- Not in active foreclosure or bankruptcy
- Has social capital - a network of a few supporters willing to contribute to your private fundraising phase
- What can Kiva funds be used for?
Kiva loans can be used for any business-related expense, including but not limited to:
- Buying equipment
- Upgrading your space
- Hiring employees
- Working capital
- How can I be successful on the Kiva platform?
- Brush up on your tech skills
- Consider how your business could be impacted by a small loan
- Upload a good profile picture and loan statement to your profile
- Work with a Kiva Trustee team
- Have a strong network of supporters
- Be willing to climb the capital ladder and repay your loan on time
For more helpful advice and counseling, visit CCI's Kiva Hub page!
- How can my institution get involved with Kiva?
Institutions can become Kiva Trustees and endorse loan campaigns of their choosing! Large organizations can even set up loan matching for the campaigns they endorse.
Trustees and lenders can also join lending teams: self-organized groups that rally around shared lending goals.