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Kiva Zip | Frequently Asked Questions https://zip.kiva.org/faq[8/27/2013 9:42:15 AM] If the US Dollar appreciates against the Kenyan Shilling over the course of the year, this means that the US Dollar will buy more Kenyan Shillings in December than in January. So when the borrower comes to repay their 10,000 KSH in December, it might only convert into 96 USD. In this case, the Kiva Zip lender will take on the foreign exchange loss. If a Kiva Zip lender made a 25 USD loan in January, they will only get 24 USD back in December. If the US Dollar depreciates against the Kenyan Shilling over the course of the year, this means that the US Dollar will buy fewer Kenyan Shillings in December than in January. So when the borrower comes to repay their 10,000 KSH in December, it might convert into 104 USD. In this case, Kiva Zip would take the foreign exchange gains, and put them into a specially-designated fund to support Kiva Zip operations. It was decided to pass the foreign exchange risk on to the lender, rather than the borrower, in order to minimize the hassle and disruption to the borrower (who will always have a significant social need) as much as possible. While it might seem unfair for Kiva Zip to pass on foreign exchange losses to the lenders, but keep foreign exchange gains, this is not motivated by a desire for Kiva Zip to gain financially. Legally, Kiva Zip is unable to pass on any rate of return to our lenders – this is the principal reason why lenders cannot directly benefit from foreign exchange gains. Does all of my loan go to the borrower? For United States loans, the entire amount of the loan goes directly to the borrower. For Kenyan loans, we build in a buffer between the amount of the loan listed on the website, and the amount of the loan requested by the borrower. The reasons for this are twofold: Firstly, we currently deal in loan shares of $5. If a borrower requests a loan of 9,000 Kenyan shillings and this converts to 90 US dollars, we round this amount up to 100 US dollars, so that we can easily divide it into four loan shares of $25 each. Secondly, there is a chance that exchange rates could fluctuate between the time when the loan is posted, and the time when it is disbursed. Imagine a borrower requests a loan 10,000 Kenyan shillings and this converts to 100 US dollars at the time the loan is posted. Now imagine that we posted the 100 USD loan on the website, and then the Kenyan shilling appreciated against the US dollar, so that a dollar bought only 95 shillings at the time the loan was funded. This would mean that the 100 USD funded by lenders would only buy 9,500 shillings, and this would mean that the borrower is 500 shillings short. In order to ensure that the experience is as smooth for the borrower as possible, we build in a small currency exchange buffer for Kenyan loans. After Kenyan loans are fully funded, any money that is not disbursed to the borrower is immediately returned to lenders. Can I connect with the borrower I made a loan to? Kiva Zip does not organize meetings between lenders and borrowers. However, Kiva Zip lenders can communicate directly with borrowers via the Kiva Zip Conversations feature. If a lender posts a comment on the Conversations tab of a loan, the borrower, the trustee, and all lenders to that loan get an email (or SMS) informing them of the comment (unless they have specifically asked to stop receiving these notifications). How can I invite people to become lenders on Kiva Zip? You can invite people to become Kiva Zip lenders by following this link . Can I withdraw my Kiva Zip credit? Yes, it is possible to withdraw your Kiva Zip Credit. All Kiva Zip withdrawals will be processed via the main Kiva website. To withdraw your Kiva Zip Credit, you will first need to transfer your funds into your Kiva account. To do so, click the "Transfer funds to Kiva" button on the “My Zip” page, and enter in the amount of Kiva Zip Credit you would like to transfer to Kiva. Once your funds have been successfully transferred over to your Kiva account as Kiva Credit, you can withdraw them by logging into your Kiva account at www.kiva.org/login. Click "Withdraw" to be taken to the Kiva withdrawal request form. Enter in the amount you wish to withdraw and the email address associated with your PayPal account to request your withdrawal. Kiva withdrawals typically take 1-3 weeks to be processed into your PayPal account. If you have any questions about Kiva withdrawals, please email contactus@kiva.org . Can I transfer my credit between Kiva and Kiva Zip? Yes! As of March 2013, Kiva Zip lenders can now use their Kiva.org accounts and credit to make loans on Kiva Zip. Once Kiva Zip lenders have linked their Kiva Zip accounts to their Kiva.org accounts, any Kiva.org credit will automatically be credited towards Kiva Zip loans in the Zip