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Kiva Zip | Frequently Asked Questions <br />https://zip.kiva.org/faq[8/27/2013 9:42:15 AM] <br />For individual trustees, the ‘credit ladders’ are as follows: <br />Loan #1 :: Maximum loan = $2,500 :: Loan term = 3 to 6 months <br />Loan #2 :: Maximum loan = $5,000 :: Loan term = 10 to 24 months <br />Loan #3 :: Maximum loan = $10,000 :: Loan term = 12 to 36 months <br />Loan #4 :: Maximum loan = $20,000 :: Loan term = 24 to 48 months <br />Loan #5 :: Maximum loan = $50,000 :: Loan term = 48 to 72 months <br />In Kenya, the amount that Kiva Zip borrowers can borrow is consistent across organizational and individual trustees, and is as follows: <br />Loan #1 :: Maximum loan = 10,000 Kenyan shillings (Ksh) :: Loan term = 2 to 3 months <br />Loan #2 :: Maximum loan = 20,000 Ksh :: Loan term = 3 to 6 months <br />Loan #3 :: Maximum loan = 30,000 Ksh :: Loan term = 6 to 9 months <br />Loan #4 :: Maximum loan = 50,000 Ksh :: Loan term = 9 to 12 months <br />Loan #5 :: Maximum loan = 70,000 Ksh :: Loan term = 9 to 12 months <br />What loan terms are available to borrowers on Kiva Zip? <br />The minimum and maximum loan term for each loan ‘tier’ are detailed above. <br />Grace periods of up to six months are allowed for agriculture businesses, and start-up businesses (that is, businesses that have not started <br />making sales yet). <br />Loan repayments can be made in either weekly or monthly installments, whichever is most convenient for the borrower. <br />What interest rates does Kiva Zip charge? <br />Lenders receive 0% interest from the loans they make on Kiva Zip. <br />Borrowers also pay 0% interest on their loans. <br />However, although they do not pay interest, there may be some operational costs associated with sending and receiving payments. Kiva Zip <br />aims to cover these costs during the alpha phase, and will work to reduce such costs as much as possible. <br />What happens to the borrower if he or she doesn’t pay back a loan? How about to the trustee? <br />In the unfortunate event of a missed repayment, several things will happen to the borrower: <br />Kiva Zip will follow up with them to understand why they are behind on their repayments <br />The trustee should do the same thing <br />In the case of a defaulted loan, several things will happen to the borrower: <br />The defaulted loan may be recorded on their credit score <br />The borrower will be prevented from getting a Kiva Zip loan in the future <br />We may interview the trustee, and seek to interview the borrower, to understand why this loan defaulted, and how we can better anticipate <br />this in the future. <br />How can borrowers qualify for larger loans on Kiva Zip? <br />Borrowers must fulfill several criteria, in order to qualify for future, larger loans on Kiva Zip: <br />Most importantly, borrowers must pay back their first loan(s) ontime. Some leeway will be given for slightly late payments on individual <br />repayments, but in order to qualify for a larger loan, the final loan repayment of the previous loan must be made ontime. Borrowers can <br />still qualify for subsequent loans, even if they are late with their final repayment of their first loan, but these subsequent loans can only be <br />up to the amount of the first loan. <br />Borrowers must be in good standing with their trustee. Their trustee must write another endorsement for each subsequent loan that the <br />borrower applies for. If the borrower and their trustee are no longer in good standing, and the trustee is unwilling to endorse the borrower <br />for another loan, the borrower can still qualify for another loan, but only if they have two trustees that are willing to endorse them for the <br />next loan. Both of these trustees will be vetted by Kiva Zip, according to our standard practices.