1

Kiva Zip Basics Please complete the quiz on the right as you review this training material

Kiva Zip Trustee Training

2 What is Kiva Zip? Kiva  Zip  is  a  website  (h'ps://zip.kiva.org)  that  enables  financially  excluded  and  socially  impac?ul  entrepreneurs  to  access  0%  interest  small  business  loans,  by  posAng  their  personal  and  business  stories  online.  Loans  are  funded  by  lenders  around  the  world.  

Kiva  Zip  Is…   Kiva  Zip  is  NOT…  ü Pla>orm  that  connects  lenders  to  borrowers   "   NOT  a  bank  or  a  Microfinance  InsAtuAon  ü  Loan  that  needs  to  be  repaid   "   NOT  a  grant  or  donaAon  ü 0%  interest  loan   "   NOT  loan  with  interest,  fees,  or  collateral  

3 What is Kiva Zip’s model?

People from all around the world who want to support entrepreneurs and make a difference

Under-banked & unbanked entrepreneurs

Organizations or individuals who have long-standing relationships with entrepreneurs

Lenders identify borrowers to lend to;

Borrowers repay lenders over time

Trustees support borrowers during their loan

Trustees ensure lenders are lending to credible people

Kiva  Zip  is  a  community  of  people  –  borrowers,  trustees,  and  lenders.  The  model  is  based  on  trust.  

Lenders  

The  Kiva  Zip  Model  

Borrowers  Trustees  

Kiva Zip connects lenders, borrowers, and trustees

4 How does Kiva Zip work? (Part 1)

Kshs.  5,000  

Kshs.  3,000  

Kshs.  2,000  

Kshs.  10,000  

Lenders  from  across  the  world  lend  to  Kiva  Zip  borrowers  through  the  Internet  

Borrowers  use  loan  to  improve  and  expand  their  businesses  

Kiva  Zip  disburses  loan  to  borrowers  through  M-­‐PESA  

Trustees  endorse  and  support  borrowers  

Lenders  to  Borrowers:  Loans  are  funded  by  lenders  across  the  world,  facilitated  by  Kiva  Zip,  and  disbursed  to  the  borrowers  through  M-­‐PESA.  

5 How does Kiva Zip work? (Part 2)

Kshs.  5,000  

Kshs.  3,000  

Kshs.  2,000  

Over  12  weeks:  Kshs.  833  Kshs.  833  Kshs.  833  Kshs.  833  Kshs.  833  Kshs.  833  

Lenders  re-­‐use  fund  to  re-­‐lend  to  borrowers  in  the  future  

Borrowers  repay  loan  in  increments  though  M-­‐PESA  

Kiva  Zip  disburses  fund  back  to  lenders  

Trustees  provide  support  and  communicate  issues  

Borrowers  to  Lenders:  Borrowers  repay  the  loan  in  increments  through  M-­‐PESA;  Kiva  Zip  disburses  money  to  lenders  to  re-­‐lend  to  borrowers  

Kshs.  833  Kshs.  833  Kshs.  833  Kshs.  833  Kshs.  833  Kshs.  833  

Kshs.  10,000  

6 Scenario: Explain Kiva Zip to a potential borrower

Jackie:  Hi,  I  heard  that  you  want  to  become  involved  in  giving  microloans.  Can  you  tell  me  some  more  about  it?      Please  respond  to  her  quesSons  in  the  survey  on  the  right  side  of  the  screen.  QuesSon  1:  What  is  Kiva  Zip?  QuesSon  2:  What  does  the  trustee  do?  QuesSon  3:  Who  are  the  lenders?  QuesSon  4:  How  do  I  receive  the  loan  disbursement  and  make  payments?  

Jackie  is  an  acquaintance  that  heard  you  want  to  become  involved  with  Kiva  Zip  and  has  many  quesAons  for  you  

7 Who qualifies for a Kiva Zip loan?

q  Be 18 years or older q  Have personal M-PESA

account q  Complete free loan application q  Receive trustee endorsement q  Be willing to post a public

profile, with picture and personal story on the Internet

q  NOT currently have large debts

q  NOT have defaulted on loans with banks or microfinance institutions

Requirements  for  Kiva  Zip  Borrowers  

Sample  borrower  profiles  Good  borrower  profile  consists  of  clear  photo  of  borrower  at  place  of  business  and  detailed  personal  story  &  business  descripSon  

8 What are the terms of the loan?

§  0% interest; no fees

§  Loan must be used for business reasons

§  Borrower’s first Kiva Zip loan ranges from KES 5,000 to KES 10,000

§  First loan MUST be repaid on a weekly basis

§  Borrower has 2-3 months to repay the first loan; max loan period is 12 weeks

§  There is no grace period for the first loan

§  If borrower repays loan on time and in full, then borrower may qualify for a repeat loan that is larger with more flexible terms

Basic  Loan  Terms   Typical  loan  term  for  first-­‐3me  loan  

9 Scenario: Explain Kiva Zip to a potential borrower

Jackie:  Wow,  that  sounds  amazing!  I  think  a  Kiva  Zip  loan  would  really  help  my  business.    Please  respond  to  her  quesSons  in  the  survey  on  the  right  side  of  the  screen.  QuesSon  5:  What  is  NOT  required  to  get  a  Kiva  Zip  loan?  QuesSon  6:  As  a  new  trustee,  what  is  the  maximum  size  of  her  first  Kiva  Zip  loan?  QuesSon  7:  What  are  her  payment  terms?  QuesSon  8:  How  can  she  receive  bigger  loans?  

Jackie  is  an  acquaintance  that  heard  you  want  to  become  involved  with  Kiva  Zip  and  has  many  quesAons  for  you  

10 What is a Trustee?

Types  of  Trustees:  OrganizaSons  &  Individuals  

Trustees  are  organizaSons  or  individuals  who  have  strong  Ses  in  their  communiSes.  Trustees  recommend  credit-­‐worthy  borrowers  to  Kiva  Zip,  guarantee  borrowers’  

character,  and  support  borrowers  throughout  the  process.    

Where  trustees  are  

Trustee  does   Trustee  does  not  ü Endorse  borrower  for  a  Kiva  Zip  loan   "   NOT  fund  borrower’s  Kiva  Zip  loan  ü Guarantee  borrower’s  character  in  public   "   NOT  guarantee  borrower’s  loan  ü  Support  borrower  throughout  the  process   "   NOT  charge  borrower  a  fee  or  interest  

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Borrower  SelecSon  

What are the core responsibilities of Trustee?

Borrower  Training  

Borrower  Endorsement  

Loan  Process  Support  

Repayment  Support  

ü  Select  borrowers    you  know  well  and  trust  ü  Select  borrowers  whose  business  you  believe  in  ü  Select  borrowers  you  think  have  the  capacity  to  repay  

ü  Endorse  borrowers  who    demonstrate  knowledge  of  the  program  

ü  Endorse  deserving  borrowers  for  repeat  loans  ü  Help  borrowers  complete  their  applicaSon  and  upload  their  

photo  (if  needed)  ü  Make  sure  borrower  has  answered  quesAons  truthfully  

ü  Provide  moral  and  technical  support  to  borrowers  ü  Help  borrowers  manage  repayments  and  delinquencies  and  

push  to  pay  if  needed  

ü  Help  borrowers  understand  how  Kiva  Zip  works  ü  Emphasize  the  importance  of  lender  connecSon  

Trustees  play  a  pivotal  role  in  ensuring  Kiva  Zip  builds  a  strong  foundaAon.  

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Kiva  Zip  Lending  Process  

What is the lending process?

Steps  with  significant  trustee  involvement  

Trustee  selects  &  endorses  borrower  

Borrower  completes  

loan  applicaSon  

Trustee  reviews  

applicaSon  

Kiva  Zip  reviews  &  approves  loan  

Loan  is  funded  &  

disbursed  to  borrower  

Borrower  repays  loan  and  updates  

lenders  

1 2 3 4 5 6

Trustee  idenAfies,  trains,  and  endorses  credit-­‐worthy  borrowers  

Borrower  creates  profile,  incl.  photo,  personal  story,  and  business  descripAon  

Trustee  reviews  info  on  the  loan  applicaAon  and  approves  as  appropriate  

Kiva  Zip  reviews  borrower  profile,  and  if  approved,  then  posts  profile  online  for  fundraising  

Lenders  fund  the  loan;  once  fully  funded,  loan  is  disbursed  to  borrowers  on  the  next  set  disbursement  date  

Borrower  repays  loan  and  provides  updates  to  lenders;  once  repaid,  borrower  may  be  eligible  for  repeat  loan  

1-­‐4  weeks   1-­‐3  weeks  

13 What are benefits of being a Kiva Zip Trustee?

Branding   Networking   Support  

§  Kiva  is  recognized  as  one  of  the  top  non-­‐profits  in  the  world  

§  Kiva  has  1  million+  lenders  around  the  world  

§  Kiva  has  300,000+  twi_er  followers  and  blog  subscribers  

§  Kiva  Zip  has  over  100  trustee  partners  across  Kenya  

§  Kiva  has  connecAons  to  insAtuAonal  donors  and  non-­‐profits  around  the  world  

§  Kiva’s  lender  capital  enables  you  to  enhance  your  value  proposiSon  at  li'le  to  no  risk  

§  As  a  Kiva  partner,  you  have  access  to  trained  legal,  microfinance,  and  financial  experts  

As  one  of  the  top  non-­‐profits  in  the  world,  Kiva  Zip  provides  trustees  with  credibility  associated  with  the  Kiva  brand  and  an  internaSonal  network  of  supporters  

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14 Scenario: Explain Kiva Zip to a potential trustee

Charles  is  interested  in  becoming  a  trustee  and  has  many  quesAons  for  you  

Charles:  I  heard  you  are  applying  to  become  a  Kiva  Zip  trustee.  Can  you  tell  me  about  it?    

Please  respond  to  his  quesSons  in  the  survey  on  the  right  side  of  the  screen.    QuesSon  9:  Can  a  trustee  be  an  organizaAon  or  an  individual?  QuesSon  10:  What  is  NOT  the  role  of  a  trustee?  QuesSon  11:  How  should  I  support  borrowers  during  their  applicaAon  process?  QuesSon  12:  How  can  I  benefit  from  being  a  trustee?  

15 How many loans can a trustee endorse?

Tier How to Qualify for the Tier Portfolio Limits at the Tier # of Completed

Loans Cumulative

Repayment Rate # of Outstanding Loans Allowed

Credit Level of First Time Borrowers

Pilot n/a n/a 10 Credit Level 1

Tier 1 10 ≥80% 20 Credit Level 1

Tier 2 20 ≥85% 30 Credit Level 2

Tier 3 30 ≥90% 20 new endorsements each month Credit Level 3

Paused / Closed 0 n/a

Kiva  Zip  Trustee  Tiers  

#  of  Completed  Loans:  Number  of  loans  that  have  been  fully  repaid  

Each  Kiva  Zip  trustee  qualifies  for  a  trustee  Ser,  which  determines  the  number  of  loans  trustee  can  endorse  and  the  credit  level  of  those  loans.  To  qualify  for  a  specific  Aer,  trustee  needs  to  meet  min  repayment  rate  and  loans  completed  requirements.  

CumulaSve  Repayment  Rate:  %  of  loan  repaid  by  borrowers  to  date  

#  of  Loans  Outstanding:  Number  of  loans  endorsed  and  not  fully  repaid  

Credit  Level:  loan  terms  allowed  for  new  borrowers  endorsed  by  the  trustee  

Start  as  Pilot  

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Credit Level

How to Qualify for the Credit Level Loan Terms at the Credit Level

Min On-Time Repayment

Min. Term of Previous Loan Max Amount Max Term Repayment Frequency

1 None None 10,000 Ksh 3 months Weekly

2 >80% 2 months 20,000 Ksh 6 months Weekly

3 >90% 4 months 30,000 Ksh 9 months Weekly, Bi-Weekly

4 >90% 6 months 50,000 Ksh 12 months Weekly, Bi-weekly, Monthly

5 >95% 9 months 70,000 Ksh 12 months Weekly, Bi-weekly, Monthly

How much is each new or repeat loan?

Credit  level  of  a  new  borrower  depends  on  which  Trustee  Tier  his/her  trustee  is  qualified  for.  

Kiva  Zip  Credit  Ladder  

Each  Kiva  Zip  borrower  qualifies  for  a  credit  level,  which  determines  the  maximum  amount,  term,  and  repayment  frequency  allowed  for  the  loan.  To  qualify  for  a  specific  credit  level,  borrower  needs  to  meet  repayment  and  minimum  loan  requirements.  

New  Borrowers  

Repeat  Borrowers  

As  a  borrower  repays  the  loan,  he/she  moves  up  a  credit  level,  as  long  as  the  repayment  and  minimum  term  requirements  are  met.  

Start  Here  

17 What are the next steps? A_er  selecAng  borrowers,  trustee  needs  to  train  borrowers  on  Kiva  Zip.  InstrucAons  and  material  for  borrower  training  can  be  found  in  the  Trustee  Resource  Center.  A_er  training,  trustee  needs  to  complete  an  online  endorsement  for  each  borrower.  

To  endorse  a  borrower,  trustee  needs  to  log  into  the  Kiva  Zip  account  at  zip.kiva.org/my,  and  complete  an  endorsement  form  for  each  borrower.  

To  begin  endorsing  a  New  Borrower,  trustee  must  provide  accurate  name  and  mobile  phone  number.      Borrower  will  be  sent  instrucAons  on  how  to  complete  the  loan  applicaAon.  

18 How to select borrowers to endorse? Borrower  selecSon  is  one  of  the  most  significant  roles  that  trustees  play  in  their  relaAonship  with  Kiva  Zip.  Lenders  across  the  world  place  their  trust  in  the  trustees  to  idenAfy  credit-­‐worthy  borrowers  with  strong  characters.  

ConsideraSon   Best  PracSce  1.  Length  of  Sme  trustee  has  known  the  borrower  

At  least  6  months  

2.  Distance  between  trustee  and  borrower  

Same  village,  town,  or  city  

3.  Frequency  of  interacSon  between  trustee  and  borrower  

At  least  once  every  two  weeks  

4.  Character  of  the  borrower  

Strong  character,  good  work  ethics,  honest,  and  trustworthy  

5.  Type  of  relaAonship  between  trustee  and  borrower  

Mentor  /  teacher,  congregant,  close  friends,  community  leader  

6.  Number  of  common  acquaintances  

The  more  the  be'er  

ConsideraSon   Best  PracSce  1.  Length  of  operaSon  (historical  business  performance)  

At  least  6  months  in  operaAons;  if  newer  business,  then  higher  trustee  involvement  is  recommended  

2.  Current  financial  situaSon  and  expected  revenue  /  income  

Monthly  profit  (revenue  less  cost)  should  be  equal  to  more  than  5,000Ksh  

3.  Use  of  loan   Trustee  should  assess  whether  purpose  of  loan  and  amount  requested  are  reasonable  

Evaluate  Trustee-­‐Borrower  RelaSonship   Evaluate  Borrower  Capacity  to  Pay  

19 Scenario: Explain Kiva Zip to a potential trustee

Charles  is  also  interested  in  becoming  a  trustee  and  has  many  quesAons  for  you  

Charles:  InteresAng...  Can  you  give  me  more  details  about  how  the  system  works?  

Please  respond  to  his  quesSons  in  the  survey  on  the  right  side  of  the  screen.    QuesSon  13:  What  is  the  maximum  number  of  loans  a  new  trustee  can  endorse?  QuesSon  14:  How  do  I  become  a  Tier  1  trustee?  QuesSon  15:  How  does  the  borrower  credit  ladder  work?  QuesSon  16:  What  kind  of  candidate  would  be  an  ideal  borrower?  

20 What resources are available? Kiva  Zip  Kenya  Trustee  Resource  Center  provides  informaAon  and  material  to  support  trustee’s  role.  Please  read  through  the  Kiva  Zip  Policies  and  Kiva  Zip  Processes  secAons  of  the  resource  center  when  you’re  ready  to  endorse  a  borrower.  

Link to Trustee Resource Center: https://kiva.app.box.com/s/44sp7ccksdvxoleiperd

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To contact Kiva Zip Kenya

To find out more about Kiva Zip

To access Trustee Resource Center

Kiva Zip Kenya Key Contacts

h_ps://zip.kiva.org    

contactzip@kiva.org   +254  700  254  851  

h_p://Snyurl.com/TrusteeResourceCenter  

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Thank you for becoming a trustee!! We look forward to working with you.