Kiva U.S. Crowdfunding Resources

As part of our efforts at Kiva U.S. to rethink creditworthiness, we conduct social underwriting – this means we review applications in a holistic way, considering not only financials, but also your business's presence and image in your community.

Social underwriting occurs during the application review process, and also when you go through the Private Fundraising phase (PFP). PFP is a 15-day (max.) period in which you rally the support of friends, family, neighbors, colleagues, and others in your network to each contribute a loan to your campaign. Depending on your loan amount, you may need to get anywhere from 5-50 individuals to contribute to your campaign during PFP.

As soon as you reach your "Private Lender goal" (e.g., the # of individuals who need to contribute to your campaign during PFP), ➡️ your loan will advance to Kiva.org, our PUBLIC platform, where our global Kiva lender community 🌐 (more than 2.1MM people!) will see your campaign and support you in crowdfunding your loan.

This Public Fundraising phase lasts up to 35 days, but should you fully fund your loan before 35 days are over, your campaign will be completed and you'll need to wait just 7 business days prior to receiving the loan funds to your PayPal account!

Check out our Kiva Crowdfunding 101 visual one-pager here.

While banks and most other financial institutions use a data-based system, examining credit score, cash flow, and collateral value, we conduct social underwriting – a more personal, character-based approach.

The Private Fundraising Period (PFP) is integral to Kiva’s social underwriting process.

Your loan is approved partly based on your character, and PFP is how we ask you to prove your character to us.

We have found that both the amount of support a borrower solicits and receives during crowdfunding, as well as the endorsements a borrower receives, both official and through these loan contributions, are incredibly powerful predictors of a loan’s repayment rate.

By emphasizing character over credit, we're able to serve those who often don’t meet the criteria set by traditional financial institutions. At Kiva U.S., what matters is whether you’re trusted by your community, and this trust will show in Private Fundraising.

After all, would your friends and family members contribute to your loan if they didn't think you would repay them and other Kiva lenders?

✅ It’s as simple as this: if your community and lenders trust you and believe in your business and entrepreneurial spirit, so will we.

Because here at Kiva, we believe that your creditworthiness is determined by the strength of your character and standing in your community.

We're glad you asked! Social underwriting is the process we use here at Kiva to determine whether or not to grant a loan.

While banks and most other financial institutions use a data-based system purely quantitative data, e.g., credit score, cash flow, and collateral value; social underwriting is a more personal, character based approach.

What social underwriting boils down to is this:

Your creditworthiness is determined by the strength of your character and your standing in your community.

We use the following factors to assess your creditworthiness:

● Private Fundraising Period: Here you'll be asked to rally the support of between 5-40 (# depends on your loan amount) "private lenders" – these are individuals in your network (friends, family members, neighbors, colleagues, etc.) who are vouching for you by lending to your campaign. This period lasts up to 15 days.

● Public Fundraising Period: Here you'll have up to 35 days to fully fund your loan. It is an all or nothing campaign. Your efforts to connect with and bring in lenders will highlight the viability of your idea and your entrepreneurial spirit.

Endorsements: Applicants may be endorsed by Kiva’s Trustees – organizations invested in economic development in their communities. An endorsement from a Trustee shows Kiva you fit the spirit we look for in our borrowers. This is entirely optional, however, and you will not be penalized if you do not have a Trustee endorsement.

We have found the number of lenders invited (and successfully converted) by the borrower and endorsements a borrower receives to be an incredibly powerful predictor of that individual's loan repayment rate. By focusing on these personal aspects, Kiva U.S. hopes to help people who don’t meet the criteria set by traditional financial institutions.

In this community-backed, character-based lending here at Kiva U.S., what matters is whether you’re trusted by your community. If your community and lenders trust you and believe in your business and entrepreneurial spirit, so will we.

📢 Prep your local community before your loan is posted / goes live.

•Your community is more likely to lend to you if they already know what Kiva is.

• While you’re working on your application and when it’s being reviewed, tell your family and friends about Kiva.

• Have them check out the website and news articles, so when the time comes they already have the information they need to feel comfortable lending to you.

🗓️ Create an artificial deadline.

• While you have 15 days during Private Fundraising, the faster you get your community on board, the faster and more successfully your loan will fund in Public Fundraising.

• This also helps to avoid trouble with last-minute tech problems and family members potentially forgetting to lend.

• Try a call-to-action like the following: “I need my community to lend by X date, but my personal goal is to get everyone on by Y date. Will you help support my loan?”

📲 Begin by calling those in your immediate network.

During the call:

• explain what Kiva is (here's a visual one-pager that does that for you!)

• provide details about your business

• walk them through the lending process (emphasize that they WILL be repaid!), and

• ultimately encourage them to act and contribute to your campaign.

📧 Send out personalized emails to 30-40 individuals in your network.

• Here are some templates we recommend.

 •Think outside the box in terms of your network — invite not only your friends and family, but also your customers, neighbors, co-workers, and greater network of peers.

* Remember to emphasize that they can make a difference for you and your business making a loan, which they will get back. 

💡 Describe your vision and explain how this loan will make a positive impact for you, your business, and your community.

👉 Emphasize that this is a loan, not a donation.

As you make your monthly repayments, your lenders will slowly be paid back, and they can either withdraw the funds from their Kiva account to their PayPal account, OR they may recycle the funds and lend to another borrower on Kiva!

📨 Ask for support, then follow up.

Your language is important. Stress that it is a character reference in the form for a small loan. Make sure you ask your community members if they will support your loan and share your loan link.

The more specific you can get individuals regarding their pledge, the more likely they will follow through (for example, someone who says “I will lend to your Kiva loan on Wednesday when I get home from work” is more likely to lend than someone who just says “Sure, I’ll lend”).

💚 Don't forget to thank and update your community. Gratitude goes a long way.

"Certainly, though, when you want to make films, you need money. Raising money is part of being a filmmaker. It’s a central part. It’s essential. I’ve got no problem asking people for money. Because I believe. I believe in my talents, my storytelling abilities, and also the people I surround myself with on the projects that I make." - American filmmaker, Spike Lee

It's no secret that asking for money is one of the biggest challenges in successfully funding a business, whether through Kiva or elsewhere.

By learning how to ask for what you need in the most effective way, you're setting yourself up for success.

And keep in mind: by giving others the opportunity to help you, you're helping them help themselves. Through Kiva, people are lending money and not receiving any interest in return, so their benefit comes in the form of an exchange, whether tangible or intangible. Perhaps you'll be providing them a free service with your business, or a discounted product, or some other inspiration or entertainment via your business for which you're crowdfunding a loan.

Ask yourself: How can I make this an exchange, a two-way street? How can I show my gratitude to my lenders?

Perhaps you'll keep a blog where you'll share updates about your business plans and growth. Perhaps you'll send out a weekly or monthly newsletter. Perhaps you'll provide update your lenders via Kiva's platform.

In sum:

1. Believe in yourself.

2. Get comfortable with the discomfort.

3. Make sure your lenders sense your appreciation.

No! Although Private Fundraising is often the more challenging of the 2 Kiva Crowdfunding phases, your job isn't over quite yet.

The more lenders that support your campaign, the faster you’ll get your loan. Have more  potential supporters (perhaps business partners, customers, suppliers) within your network than your assigned goal?

We encourage you to reach out to them even after you’ve reached your Private Lender goal; these individuals can continue supporting you during Public Fundraising.

The more contributions made to your loan, the more momentum you'll have, the more "favorable" your loan campaign will appear on Kiva.org, and the more likely you are to fully fund!

Check out this Kiva Crowdfunding 101 one-pager for a refresher on the crowdfunding process. (Spanish version here.)

Once you reach your Private Lender goal, your loan goes automatically to Kiva.org, our global platform that is visited by our community of 2.7 million lenders: this is Public Fundraising! 🌐🖥️💳

During this period, your community and the global Kiva community will have up to 35 days to fund the rest of your loan.

Though being visible to the Kiva lender network gives you a huge boost, borrowers who also continue to fundraise on their own fund faster and are much more likely to raise their full loan amount. For that reason, continue to spread the word about your business, lean on your network, ask your friends to promote your campaign and share your loan link, and use social media – whether business, personal, or both – as much as you can during this fundraising phase.

📆 Utilize our Fundraising Calendar! It recommends daily steps you can take to leverage your network and tell new people about your business.

✅ Make sure your loan profile is an accurate representation of your business. High quality photos and stories are appealing to lenders. Find tried and true best practices on how to create an exceptional profile here.

🗒️ Send a note to your lenders! Your updates tab is the best way to thank your lenders and provide updates about your business. Lenders favor borrowers who are engaged throughout the fundraising process. Learn how to update your borrowers here!

💭 Expand your network. Think creatively about other groups, organizations, or networks that may not be in your immediate network. Even if you haven’t worked directly with them, you can always get your friends to spread the word to their networks, colleagues to share the news at church, etc. Maybe your neighborhood has a discussion forum or newsletter? Be entrepreneurial! We believe in you and your ability to get the support you need.

While fundraising on Kiva, borrowers should expect to recruit some lenders from within their own network.

However, borrowers may not:

• Engage in self-promotion, advertising or solicitation on Kiva.org.

  • For example: Do not promote your loan in private lender messages or in Kiva lending team groups (unless you have permission from the team captain).

• Fund any portion of their own loan.

In the event of either of these instances, the share purchase(s) will be refunded, and further, more severe actions might also be taken, depending on the circumstances.

This may happen, unfortunately.

Regarding refunds:

If your Public Fundraising Period ends and your loan has not fully funded, those who lent to your campaign will be refunded* almost immediately (within 1 business day max.).

*Please note that the funds will be available in lenders’ Kiva accounts and not their bank account.

Regarding reapplying:

 •If you funded 50% or more of your Kiva loan, you can reapply immediately.

• If you funded less than 50% of your loan, you can reapply after 3 months.

Please contact borrowers@kiva.org if you wish to further discuss this.

Because building strong relationships with your lenders will be a win-win.

Lenders favor borrowers who are engaged throughout the fundraising process! After all, they lent to your business for a reason!

💬 Let them know how things are going. 🤝 Thank them for believing in you and your business vision. 🗒️ Develop the relationship and create a sense of trust by sending them a quick update.

Kiva makes updating your lenders easy! In fact...

... it's easy as 1 2 3:

1️⃣ Access the relevant part of your Kiva Borrower Dashboard (same log-in which you used for your application) here: https://www.kiva.org/my/borrower/update. 2️⃣ Write your update. 3️⃣ Click “Post Update”!

📩 Your lenders will receive an email notification including your message.

💬 📲 📧 This one-pager was created in response to feedback from Kiva borrowers regarding wanting support in explaining Kiva to friends, family members, neighbors, colleagues and others in their network who may have never heard of Kiva.

You can also reference our main site, Kiva.org, for more information and talking points.

Loan matching is a feature that allows some loans a lender makes on Kiva to be matched by an individual or larger organization that has set up a loan matching fund.

How it works: If a lender lends $25 or more to a loan that is being matched, the matcher will contribute another $25 towards that loan as well. Matchers may match all Kiva loans or just a particular type of loan (loans in a certain geographic area, to a particular type of borrower, etc.).

To check if your loan is eligible for matching, look for a Matched Loan icon on the right section of your loan profile.

There will be no change to the total amount of repayments. In other words, you will be repaying the individual or organization who contributed the "matching dollars" while you were crowdfunding; for this reason, your monthly repayment amount will not change and will not be affected by matched dollars.

No, your loan will still be the same amount. If, at any point during crowdfunding, you see that your loan is being 2x-matched, that means that each lender's contribution will be matched.

Therefore, you'll likely arrive at your total crowdfunding goal (i.e., the Kiva loan amount for which you qualified) faster than expected!

Due to the popularity of loan matching, our sponsors’ funds are often used up very quickly.

We cannot guarantee the duration of the matching, but strongly encourage borrowers to try to get as many lenders as possible while the sponsors’ funds are still available.

When you no longer see the “#X Matched!” banner on your loan page, it unfortunately means that the matching funds are no longer available.

You celebrate! 👏🎉 You did it!

✅ And then you wait a maximum of 7 business days prior to receiving the loan funds to the PayPal account you provided when you applied.

📝 And, while you wait, why not share a quick update with your lenders, thanking them for contributing to your campaign, mentioning your excitement and noting once again the plans you have for your business?

Unless otherwise specified in your Kiva Borrower Contract, your 1st repayment to your lenders will be due exactly 1 month after you receive your loan, and future repayments will follow that monthly cadence.

When you receive money on PayPal, that money will not appear immediately in your bank account.

Here's how it works:

1. The money goes into your PayPal account.

2. You must go into your PayPal account to claim the money and transfer it into your bank account.

(Until you do step 2, the money will stay safely in your PayPal account.)