Nslc 2010 kiva hs

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  • 1. NSLC 2010 Premal Shah President Kiva www.kiva.org Parth Shah National Director Kiva High School"Revolutionising how donors and lenders in the US are www.kivahighschool.orgconnecting with small entrepreneurs in developing countries

2. What is Microfinance? Microfinance = small capital The poor are typically excluded by financial service providers: No collateral No credit history Illiteracy The poor need financial services, and already use them informally: Borrowing money from loan sharks with interest rates so highthat it may be impossible to ever pay back Savings accounts kept in the home, vulnerable to theft Investing in livestock which is vulnerable to disease Microfinance works to provide the poor with these financial services, in a Safe and controlled environment, through a microfinance institution Give a man a fish, feed him for a day. Teach a man to fish, feed him for a lifetime. What if he knows how to fish,but just cant afford a fishing net?2 3. Microfinance Institutions There are thousands of microfinance institutions aroundthe world, and they all vary a little depending on theregion they are in and people they are targeting to help Some focus on women in places where women dont havethe same rights as men and so have no economic empowerment Some focus on the rural population in areas wherepeople are isolated and cannot travel to cities to accessservices Some focus on a comprehensive program whichincludes business training with financial products What ties them all together, however, is a desire to help thepoor by providing them with financial services 4. Traditional Microfinance Lending Process Banks andNGOs Microfinance institutions typically get the money that theylend, from banks or non-governmental organizations, or both This can be expensive, as it is often borrowed with interest There may also be difficult application procedures to accessdebt capital from non-governmental organizations Some organizations can even find themselves shut out dueto the region they operate in, particularly post-conflict regionsMicrofinance Institutions Restrictions that microfinance institutions face ultimately affect theentrepreneurs, who rely on microfinance institutions to serve themEntrepreneurs 5. Why loans rather than charity? Dignified Business Transaction Spreading opportunity, rather than charity Sustainable A Hand-up not a hand-out! Spreading opportunity rather than spreadingwealth5 6. Guiding personal principle"Dont ask what the worldneeds, do what makes youcome alive; because what theworld needs most are peoplewho have come alive." -- Howard Thurman 7. Key milestones and how alive I felt SEWAPayPalResearch acquired byOMG its ProjecteBayworking!Alive-nessPersonalJoined smallLeave fordiscovery ofstart up: Kiva.orgMicrofinance PayPalI got this idea Big company Sophomore Management do I matter? slump Consultant in Newangst York2033 Age 8. Kiva 101 Online marketplaceInternetLocal Partner Entrepreneur Lender(MFI)MoneyInformation 9. 550K people lent $120M to 200K entrepreneurs in 4 years 5 yr goal =Other Key Stats $1 Billion Growth: $1M loans every week Repayment Rate: 97% Recycle Rate: 65% MFI Portfolio: 115 MFIs in 50 countries.Growing 3 a month. Traffic: 40,000 visitors / daily Organization: 35 employees / 500 volunteers Leverage: $10 in loans for every $1 donated. 10. Kiva utilizes 4 Web 2.0 principles1. Create an Addictive User Experience2. Be Radically Transparent3. Crowdsource against constraints4. Build in increasing returns on data10 11. Create an Addictive User ExperienceAddictive = Easy + Fun11 12. How Kiva tries to make it EasyDesigned for everyday people, not affluent expertsI can see the person Im lending toLow cost toentry Quick and easy checkout Business relationship based on mutual dignity, not pity 12 13. How Kiva tries to make it FunBadging, Teams, fast changing UGC, stats...Real time un- edited updates Loans are fullyfunded in hours TransactionshappenRandomized every 18 1 minute ofsecondsfame +LendingTeams13 14. For some, Kiva is becoming very addictive! 14 15. Be Radically Transparent Transparency Authenticity Trust 16. Kiva and Radical TransparencyPaying for Kivas overhead is an explicit choice 17. Kiva and Radical TransparencyData inaccuracy and defaults are made explicit 18. Crowdsource against constraints Big constraint? + No resources? = Crowdsource 19. Kiva and CrowdsourcingKiva Fellows ProgramHow do we train MFIs, gather progress updates and verify data accuracy hyper-fast? 20. Kiva and CrowdsourcingKiva Translator ProgramHow do we immediately translate entrepreneur profiles from native language to English? 21. Build in Increasing Returns on DataLeading public platform + Data integrity Increasing Returns on Data 22. Public reputation system for MFI Risk and Social PerformanceKiva Social RatingKiva Risk Rating Social RatingRisk Rating 23. Kiva and Increasing Returns on DataWorlds largest DB of microfinance investmentsShort Term: MFIs could use Kiva to build Long Term: Entrepreneurs could usecredit worthiness to other fundersKiva as a public credit bureau Result: 30,245,763 loans found 24. Kiva High SchoolMission - to bring together and organize high schoolstudents interested in fighting poverty on both a localand national scale.How does Kiva High School Work?1.Starter-Kit What is Kiva/Microfinance/Kiva High School? How to setup a chapter Chapter fundraising ideas Chapter finances 24 25. Kiva High SchoolWhat does Kiva High School bring to your school? Awareness of global issues such as poverty Give high school students a platform to make a powerful impact Show the capacity of microfinance and the ripple effects of your loan A network of like-minded students that are unified through a central organization 25 26. Kiva Fellow Videohttp://fellowsblog.kiva.org/2010/03/11/12745/26 27. Thank you and questions27