Kiva.org, one of the pioneers in micro-lending to entrepreneurs, is entering the educational space today, launching the pilot program of student microloans on the platform.
Kiva is a peer-to-peer lending site that began as a way to facilitate micropayment loans between citizen lenders and extremely low-income entrepreneurs in developing countries, Through Kiva’s platform, anyone can loan $25 or more to support an entrepreneur and the specific progress of the loan can be tracked from initial funding to repayment. Upon receiving repayment, lenders can withdraw their funds from Kiva or lend again to another entrepreneur, thereby continuing the lending cycle.
Most of the entrepreneurs who benefit are in developing countries, but last year Kiva opened up its service to needy U.S. entrepreneurs last summer (which caused some controversy). It also has APIs for other developers to build on its data set.
With the Student Microloans program, now anyone can lend as little as $25 to students in Bolivia, Paraguay and Ecuador to to fund their educations. Similar to the way the organization handles its small business loans, Kiva is working closely with its Field Partners in the three countries to find students and to create a loan offering tailored for the countries’ students. In some cases, Kiva is providing the additional reach needed to fund its current portfolio of student loans and, in another case, Kiva’s partner is creating their first ever student microloan offering.
As with other Kiva loans, the progress of the loan can be tracked from initial funding to repayment. Typically, students have between one and three years to pay back their loans. Upon receiving repayment, lenders can withdraw their funds or re-lend to another student or entrepreneur.
For example, Alicia Fructos, a student from Caaguazú, Paraguay is using Kiva to help fund her education (pictured below). From her lending page on Kiva’s site: