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Kiva Zip | Frequently Asked Questions <br />https://zip.kiva.org/faq[8/27/2013 9:42:15 AM] <br />they meet the criteria outlined above – e.g. that borrowers are financially responsible, have sound business plans, etc. <br />In addition to doing due diligence on potential borrowers before they get a Kiva Zip loan, trustees also have a role during a loan’s term, providing <br />borrowers with ongoing support (e.g. internet access, business coaching, encouraging borrowers to communicate with their lenders and make <br />partial payments in the event of delinquency, etc.). <br />A Kiva Zip trustee can be an organization or an individual. <br />A trustee does not handle any Kiva Zip loans and does not guarantee loan repayment. A trustee is not liable for repaying any loans by a <br />borrower that the trustee has endorsed. Trustees also have no fiduciary duty to Kiva, borrowers or lenders. <br />What is a vendor trustee? <br />A vendor trustee is a special type of organizational trustee in Kenya. Vendor trustees are typically social enterprises that empower individual <br />vendors to sell socially responsible goods in their community. For example, a vendor trustee might sell solar lamps to individual vendors, who <br />then go and sell that to people in the community. Vendor trustees identify potential borrowers, who then use their Kiva Zip loan to buy inventory <br />from the vendor trustee. These borrowers will then sell the inventory to people in their community, and pay back the Kiva Zip loan. Vendor <br />trustees must identify borrowers who fit the regular Kiva Zip borrowing criteria. <br />What are the qualifications to become a trustee? Can anyone become a trustee? <br />The main qualifications for a trustee are that they should have compelling answers to the following questions, which appear on their public <br />profile: <br />How will you determine whether or not the business plans of the Borrower(s) you endorse are sound? <br />How will you know whether the Borrower(s) you endorse will have the "character" to repay a loan? <br />Please describe what type of business, financial, technical or other support you plan on providing to the Borrower(s) you endorse <br />How will you establish whether the Borrower(s) you endorse are in debt, or have a history of debt? How will what you find affect your <br />endorsement of their loan application? <br />Why can't the Borrower(s) you endorse access traditional loans? <br />Anyone (an individual or an organization) can become a trustee, so long as they can provide strong answers to these questions. <br />What financial involvement do trustees have in the loan? <br />Kiva Zip trustees never handle the money associated with the loan – loans are sent directly from Kiva Zip to the borrowers, once fully funded by <br />the lenders. <br />Trustees will also not receive any interest rate or flat fee (e.g. servicing fee, referral fee, access fee, etc.) related to the loan. <br />A trustee does not handle any Kiva Zip loans and does not guarantee loan repayment. A trustee is not liable for repaying any loans by a <br />borrower that the trustee has endorsed. Trustees also have no fiduciary duty to Kiva, borrowers or lenders. <br />In Kenya, Vendor trustees have a more significant financial involvement in the loan. Again, vendor trustees do not handle the money between it <br />leaving Kiva Zip’s bank account and arriving with the borrower. And again, vendor trustees receive no interest rate or fees associated with the <br />loan. But borrowers referred by a vendor trustee will generally use their loans to buy inventory supplied by the vendor trustee. So in this sense, <br />vendor trustees have much more financial involvement with the loans of the borrowers they endorse. <br />What happens to the trustee if a borrower they endorsed doesn't pay back a loan? <br />The trustee will face no financial penalty in the event that a borrower they have endorsed defaults on their loan. Having said that, it clearly will <br />reflect poorly on their reputation if one of their borrowers defaults. <br />Over time, we will stop working with trustees who have a poor track record of endorsing borrowers who repay their loans. <br />How do I apply to be a trustee? <br />Prospective trustees in Kenya or the United States can apply to be a trustee by following this link and selecting "I want to be a Trustee". <br />Questions relating to Kiva <br />What is Kiva?