Let’s Sri How This Kiva Thing Works

By Brian Kelly, KF10, Sri Lanka

I apologize for the awfully-punned title but I really couldn’t resist. Coming down from a humidity-induced fog, I can’t be expected to think clearly or use proper blog-titling judgment at this point. I’m writing this post from beautiful Colombo, Sri Lanka, as I look out the door to a coconut tree from the head offices of brand new Kiva partner, BRAC Sri Lanka. Not only is BRAC Sri Lanka a brand new Kiva partner, but so is this teardrop-shaped island nation of Sri Lanka. I have the privilege of serving as a Kiva Fellow in the class of KF10 to help bring this partnership online and posting loans from across the country so lenders can learn a bit more about this fascinating South Asian nation while funding local businesses.

Sri Lanka is an interesting country for Kiva. Like several other countries across the world, the central bank imposes certain requirements about funds entering and exiting the country. So the Central Bank of Sri Lanka is taking a chance on Kiva by granting the ability to work in the country under the conditions that BRAC Sri Lanka borrowers on Kiva are: below the Sri Lankan poverty line, receiving a reduced interest rate from BRAC, and that funds wired from Kiva must stay in the country for at least 12 months. So this can complicate things a bit. However, due to Kiva’s net billing model, lenders can receive their repayments as BRAC Sri Lanka continues to fund loans in excess of their repayments due.

Basically what you can take away from this is:

• that it is very exciting that the Sri Lankan Central Bank has allowed Kiva access into the country and that you can now support Sri Lankan businesses through Kiva.
• But also that there is an additional risk with these loans due to the requirement of funds staying in country for 12 months in the case that BRAC ends up owing Kiva more in repayments than it has fundraised on the website for a given month.

So, as long as we keep posting loans here from Sri Lanka, and you all keep funding them, the world will continue to spin and we can all sleep soundly.

It has been a great first week so far as I’m adjusting to life in the tropics and getting settled in. In my transition from chilly Armenia to steamy Colombo, I’m learning all about a brand new MFI and its expansive operations here. With over 50,000 clients and 50 branch offices, focusing in the most devastated areas in the aftermath of the 2004 tsunami, BRAC Sri Lanka is doing some wonderful things. This country has a deep and conflicted history that I’m learning about as well; it is recovering from a nearly 30-year civil war that was officially ended in May of 2009. And we are fresh off a presidential election on January 26. The economy has begun a quick recovery since the end of the war last May, but much of the underlying ethnic tensions still seem to be unaddressed and the country appears to be in a sensitive state of flux.

Additionally, I’m dabbling in new customs such as eating rice and curry with my hands, arguing with auto-rickshaw drivers about taxi fares, and have shown some real promise in this new sport called sweating. I’m learning about fun new diseases to try and avoid, and I have officially adopted the mosquito as my arch-nemesis for the next four months.

So I’m looking forward to a new adventure here, and hoping to share my insights. I am especially intersted in seeing the differences in context of how microfinance plays a role here in Sri Lanka from the last 3 months spent in Armenia. And I promise to keep you posted.

Brian Kelly is beginning his fellowship in Sri Lanka as a member of KF10 after spending three and a half months in Armenia with KF9. To check out Sri Lankan loans fundraising on the website, please click here. And to join the brand-spanking new Sri Lankan lending team, click this link right now!