Laserfiche WebLink
File Number: 13-394 <br />Trustees are responsible for sourcing Kiva Zip borrowers , reviewing their businesses, <br />vouching for their character, and publicly endorsing them on the Kiva Zip website. Trustees <br />have no financial liability for the loans, but the Trustees’ reputations are tied to the repayment <br />rate of the borrowers they endorse. Trustees also have no fiduciary duty to Kiva , the <br />borrowers or the lenders. Trustees never actually handle the loans , which Kiva Zip disburses <br />directly to the end borrowers. Trustees can be either individuals or organizations . <br />Locally, Kiva Zip loans are currently being facilitated by Trustees in the cities of Oakland , <br />Berkeley and San Francisco. The City of Oakland’s Business Assistance Center added the <br />Kiva Zip loan program to its list of business incentives. The Berkeley Micro Finance (BMF) <br />organization is a UC Berkeley student group that empowers local entrepreneurs and start-ups <br />with Kiva Zip loans and free business consulting. In San Francisco, the Mission Economic <br />Development Agency uses Kiva Zip loans to help small disadvantaged businesses that would <br />normally not be able to achieve traditional financing for their businesses. <br />Below are scenarios of how some local businesses could potentially benefit from the Kiva Zip <br />loan platform: <br />·Restaurants could use the loan funds to modernize their existing operations or to fund <br />minor interior renovations. <br />·Tech startups could purchase equipment related to Lit San Leandro connections or fund <br />other startup costs. <br />·Small manufacturers could fund small materials and equipment purchases or startup <br />costs. <br />Acting as a Trustee, the City of San Leandro Office of Business Development will initially be <br />able to facilitate up to three (3) loans of up to $5,000 each in the Kiva Zip program. Trustees <br />(such as the City, as proposed) have no fiduciary responsibility to repay a loan made by Kiva <br />Zip to a local borrower. Trustee reputations are based on loan repayment success rates . Once <br />10 successful payments are made by those borrowers, the City may serve as Trustee for up <br />to 10 additional loans at $5,000 each. As the loans are successfully repaid, the City’s <br />reputation increases, which opens up opportunities for more loans to a maximum of 30 loans <br />at $10,000 each. <br />Below is a summary of the loan criteria that the City and Kiva Zip will use as Trustees to <br />determine eligibility for a Kiva Zip loan: <br />·The borrower must have a real social and economic need <br />·The borrower must have a sound business plan <br />·The borrower must not be heavily indebted <br />·The borrower must not be in bankruptcy or foreclosure proceedings, or about to enter into <br />them <br />·The City, as Trustee, must endorse the borrower’s character <br />·The City, as Trustee, must determine that the borrower is financially responsible <br />Office of Business Development staff will coordinate with a Kiva Zip representative in <br />reviewing each loan application to ensure that they meet the criteria. Loan applications will be <br />sponsored by the City’s Business Development Manager in consultation with the Kiva Zip <br />Page 2 City of San Leandro Printed on 10/15/2013