How Kiva Works, The Long Version


Kiva connects with a Field Partner

Kiva works with a range of organizations to find borrowers and administer loans. We call these organizations Field Partners because they work at the local level, within the communities where loans are being used to make a difference. While most of them are microfinance institutions, we also work with schools, NGOs, social enterprises and more. They all share one thing in common: the social mission to alleviate poverty and improve people’s lives. Learn more about how we vet our Field Partners >>


Field Partners disburse loans and post stories on Kiva

Our Field Partners disburse loans to borrowers as they’re needed. Most of them give out the loan before it’s even posted to Kiva. Pre-disbursing loans means that borrowers don’t have to wait for their loans to get funded on the Kiva website when they need money immediately. The Field Partner then collects stories and photos from these borrowers and posts them on Kiva to be reviewed by our volunteer editors and translators and then published.


Lenders browse profiles and choose borrowers to support

Kiva gives anyone with an internet connection the opportunity to make a loan as small as $25 to someone else to start or grow a business, afford school, build a house, switch to clean energy and much more. Kiva aggregates all of these small amounts of money to crowdfund loans to borrowers and backfill the loans already disbursed by the Field Partners. And lenders assume the risk for the loans they choose to support.


Field Partners receive Kiva lenders' funds via wire transfer

When we send lenders’ funds to Field Partners, it’s not all about backfilling loans that have already been disbursed. A lot of lenders wonder what’s the point if the loan’s already been made. But Kiva lender funds are truly making those loans possible. Because Kiva provides Field Partners with capital at 0% interest, we enable these organizations to expand their lending programs, reach new, even more marginalized borrowers, and increase the number of awesome wraparound services they offer, like health care, child vaccinations, financial literacy classes and more.


Borrowers repay their loans

Field Partners collect repayments from borrowers and any interest they charge to help cover their operating expenses. 60% of the partners we work with are non-profits that simply charge interest to cover their overhead. Kiva does not charge any interest to its Field Partners and does not provide interest to lenders. Kiva also gives Field Partners the option to cover currency losses. Learn more >>

To minimize the expense of wire transfers, Kiva uses a net billing system. For any given month, we subtract the amount of Field Partner repayments from the amount of loans made by Kiva lenders. We only ask our partners to wire payments us the difference.


Kiva returns repayments to lenders

When lenders receive repayments, they have the option to withdraw the money into a PayPal account, donate it to help Kiva cover its operating expenses or lend it to more borrowers to make an even bigger impact.


Currency Exchange Loss

When lending funds across national boundaries, the local currency in the Field Partner's country of operation may lose some of its value relative to the USD, thus requiring the Field Partner to use more of its local currency to reimburse Kiva in USD. Kiva offers Field Partners the option to protect themselves against severe currency fluctuations (a US dollar appreciation of over 10% relative to the local currency) by sharing any losses greater than 10% with Kiva lenders.* By bearing these losses, lenders are able to protect the Field Partner and its borrowers from catastrophic currency devaluations.