By Alexis Ditkowsky, KF14, South Africa
I realize your interest may be waning based on the title alone but I encourage you to keep reading because not everything a Kiva Fellow does is as wild and crazy and emotionally rewarding as a borrower visit. But, as a Kiva Fellow, I aim to please so I’ve also included pictures from a recent trip to the field at the end of this post. Now there’s something for everyone – for those of you who want to geek out a little, I’ve got you covered, and for everyone else who just wants to be transported to South Africa for a minute in the middle of the workday, you’re taken care of, too.
So, let’s talk briefly about repayment reporting. It’s an essential part of Kiva’s relationship with its microfinance partners. Each month, the partner MFI reports all the cumulative principal repaid* for its outstanding Kiva loans. Then Kiva reviews the report and accounts are balanced by the end of the month. Getting this right and setting up systems so that it’s as pain-free as possible in the future is particularly important for pilot partners like Women’s Development Businesses (WDB). Until an MFI gets a handle on the process, they are unable to transition into an active partnership with Kiva, which typically involves a dramatic increase to their monthly fundraising limit.
You’d think (and hope) that you could just tell the database that tracks your clients and their loan repayments (or Management Information System – MIS – in microfinance speak) that you want a report for all the cumulative principal repaid for all Kiva loans during a specific time-frame. That sounds pretty easy, right? Well, there are a number of reasons why it can take a little time for the MIS to be well-oiled Kiva reporting machine.
That’s where the database detective work comes in. With the generous help of Nomsa, a WDB staff member in Nelspruit, we methodologically cross-checked the MIS, the MIS repayment report, a second MIS Kiva report in a different format, Kiva’s system, and the expected repayment report from Kiva for the previous month. I’m happy to report that after two full days, I think we finally have a handle on the issues. Some of discrepancies are due to “quirks” in the system that require additional follow-up with the database consultant, others have to do with the challenge of adding a new loan product (“Kiva loans”) and how the MIS recognizes it, and another one or two will require additional investigation. That said, we have a pretty solid understanding of where the pain points are and a plan for addressing them in time for next month’s repayment report.
While I’m confident that WDB is on the right track with repayment reporting, I might just need to come up to Nelspruit again in April. My husband and I only spent an afternoon at Kruger National Park and while the hyena cubs were awesome, I have yet to see lions in the wild….
*Loans from Kiva lenders are “interest-free” which means that MFIs only need to report on the principal repaid. There is generally an “effective interest rate” of 1-2% for the MFI which reflects the time, resources, and expense of maintaining the Kiva partnership but Kiva loans are typically a cheaper source of capital than commercial loans and a more sustainable source of capital than grants.
Previous posts by Alexis Ditkowsky:
Update from the Field: Carnival, Collaboration + Cheese-Making
Update from the Field: Man’s Day, Singing Fellows + Learning How to Count
The Meaning of “Now” in South Africa
Update from the Field: Videos, Epic Commutes + Going Beyond Microfinance
Last Week in the Field: “Christmas”, Trekking, Adversity + Good Company
Next Steps for Kiva’s Partner in South Africa
First Borrower Visit (Take 350+)
A Hand-Delivered Kiva Fellow
Drawings from Training and Greetings from Boston
Part 2: Visit to the Field
As promised, photos from my recent visit with Gugu Lungile Khanyile in Mtubatuba, KwaZulu-Natal. During our interview, she impressed me with how seriously she approached her businesses of renting event supplies and raising chickens. Both are profitable but she sees a lot of room for future investment provided she can raise enough capital to purchase the supplies she needs. For example, she bought a package of 1 tent, 4 tables, and 200 chairs for ZAR 22,000 after receiving funds from a previous employer. She can rent these for ZAR 750 for local events and ZAR 800 for outside events but is unable to buy an additional tent at the moment due to the expense. She spent her Kiva loan to buy more chicks and to buy supplies to decorate the tents when she lends them out. If you have any questions about her businesses, let me know in the comments and I’ll try to answer them!