The U-City Microcredit Club held its first meeting on September 15, 2009, and since that time, has participated in 570 loans to entrepreneurs in 77 countries using the Kiva.org system of microcredit loans.
Kiva partners with existing non-government organizations (NGOs) around the world who have expertise in micro-finance and a mission to alleviate poverty. These field partners know their local area/ clients and do all the work required to get Kiva loans to the Kiva web site. The field partners disburse the loans as soon as they are granted. The field partner then collects information about the entrepreneur, pictures and details about the loan, and uploads them to Kiva. Kiva then posts them to Kiva.org along with information about the field partner.
U-City Microcredit Club meets periodically, sometimes in person and sometimes electronically, to review the loans available on Kiva.org and select the ones we would like to help fund. We loan between $25 and $100 depending on funds available and the risk we see in the loans. Kiva then aggregates the payments from the various participants and provides them to the field partner. The field partner collects repayments from the entrepreneurs as well as any interest due and notifies Kiva if the payment is not made as scheduled. Interest rates are set by the field partner. As repayments are made to Kiva, the principal is returned to us, allowing us to re-loan those funds to additional entrepreneurs.
The U-City Microcredit Club has received $6,861 from 32 persons or groups, and with those funds, have financed $43,838 in loans since we began. This means we have loaned $6.29 for every $1.00 contributed by re-loaning the repayments received.
At our July 27 meeting, we celebrated two milestones – 500 loans made and $40,000 loaned. We are extremely proud of both of these accomplishments and look forward to $50,000 in loans in 2018 or early 2019.
The repayment rate on the loans we have participated in is 98.2%. Of the 570 loans we have made 439 are fully paid off (including 46 with some currency loss) and 101 are making timely payments.
We have experienced 18 defaults and have 12 loans that are considered delinquent. Of those 12 loans, 7 are less than 30 days delinquent, 2 more are 60 days delinquent, and 3 are over 6 months delinquent. Our delinquent loans currently comprise 3.96% of our loan portfolio and our defaults are 1.51%. Due to the strength of the dollar in relation to other currencies, we continue to experience losses due to currency exchange. In 2017, 46 loans showed a currency exchange loss in total of $295.
In 2016, we expanded our lending to 3 more countries, for a total of 77. When selecting loans, we always look first at offerings from new countries in order to give us the opportunity to learn about the customs, the economics, and the people of as many countries as possible. We favor the poorest countries and the ones where it is politically unpopular (if not dangerous) to open a small business. In our lending decisions, we pay as much attention to the field partners as we do to the individual borrowers. We also understand that our decisions mean that we are accepting some risk; but as you can see from the above information, our loss and delinquents experience is good. We also take pride in the fact that our performance is significantly better than the average Kiva lender (our 3.96% against 8.16% average)
Here are some demographics:
- 73.5 % of our loans are to women
- 26.5% to men
- 24.3% are for food preparation and sales
- 25.3% are to retail businesses
- 24.8% are for agriculture
In 2017, we made 107 loans totaling $7,237. Here are some of the most interesting:
Samuel Manandona, Madagascar
Samuel is an experienced farmer who has been raising pigs more than 10 years. He is 32 years old and has two daughters. He is borrowing $175 to purchase several piglets, which he will raise to sell. This is his third loan. We loaned $25.
Nar Group Laos, Lao PDR
The Nar Group is six individuals who together are borrowing $675 to purchase a water filtering system. Phonephet is the leader of the group and understands very well the difference a water filter can make for his family and the other families in the group. Local water sources require boiling before consumption, and boiling water uses natural and financial resources. The filter will increase his family's disposable income by decreasing the money needed to buy charcoal and reducing the amount of time needed to forage for firewood.
The filters are purchased from Terra Clear, an NGO which is working to improve the health of marginalized communities through providing ceramic water purifiers. Most of Terra Clears clients cannot afford to purchase the water purifier themselves, so Terra Clear has developed a community model that allows individuals or groups to pay for the system in 11 monthly installments. We loaned $50 in January, 2017, and this loan has been paid off.
Du Ong Hong Hoa District, Thanh Hoa Province, Viet Nam
DuOng is 30 years old, married with two children. He has been a barber for the last three years, but the business is not stable, in part because the latrine where he works cutting hair is not hygienic. He is borrowing $450 to expand his barbershop and move it outside. Than Hoa Province, in central VietNam, is one of the poorest areas of the country. Than Hoa MFI targets low income clients who have the ability to work but have no access to capital. The program's benefits have been felt throughout the community, including a decrease in children dropping out of primary school and families suffering from malnutrition. We loaned $75.
Serafina Cusco, Peru
Serafina is 51 years old and has four children. She works every day in her shop doing auto bodywork and painting. She has been in business for many years and works every day. She borrowed $1,400 in April to purchase paint and paint supplies and has repaid the loan. This is her second loan. The loan was financed through Asociacion Arariwa, who works with clients in the high, nearly inaccessible areas of Peru.
Ahmad Sidon , Lebanon
Ahmad is a Palestinian refugee who lives with his wife in an apartment in Sifon, Lebanon. He has been working as a carpenter for 8 years and has a good reputation in the area. He began business with one of his friends but two years ago decided to go on his own. He is borrowing $1,375 to purchase more wood in order to finish projects that he has.
Refugees face large obstacles when it comes to access to credit, and Ibdaa was formed to help fill that gap. Despite their skills, young persons face high levels of unemployment and banks are reluctant to lend to them as well. Ibdaa is an initiative of the Arab Gulf Fund aimed at reducing poverty and unemployment in Lebanon. We loaned $100.
Gs. Vecinos De Cedino Group Choluteca, Honduras
Jose Luis, Esteban Rosa, and Lesvia Carolina are all fish salespersons on the beaches of Cedeno, Honduras. Jose is 52 years old and has been fishing or selling fish for most of his life. His customers come to the beach to buy his shellfish as do people from the restaurants on the beach. The group is borrowing $1500. Jose will use his portion of the loan to buy a dragnet, which consists of three nets: a thicker one in the center with two lighter ones over it. His old dragnets are in poor condition and need to be replaced. This is the group’s fifth loan. We loaned $100.
Kafui Tokoin, Togo
Kafui is 33 years old, married with two children. She sells pagnes (brightly decorated Western African cloth) around her area. She buys lengths of pagne in the Tokoin market twice a month to cut and resell. She is borrowing $350 to buy 20 lengths of pagne. Tokoin is in the Lome’ area of Togo which is one of the poorest and most underserved areas. We loaned $75.
We hope you have found this information to be helpful and informative. We would welcome your participation at any of our meetings. We plan them around schedules and as money becomes available to loan. Sometimes the meetings are virtual, but if there are sufficient participants to warrant a physical meeting, we do so. If you would like to be informed as to meeting times, please talk to Tom Mitchell or Rich Wymore.
We know that we are making a big difference in the lives of those whom we have served and we are helping, in a small way, to reduce poverty around the world. If you would like to be part of this effort, join us. Or, if you are interest in contributing financially to this effort, we take your contributions by credit card, debit card or PayPal account on our website.
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More information on Kiva is available on their website.
We thank you for your interest, your prayers, your contributions and your interest. Our 2017 Financial Statement is available upon request.