It started with a simple question: Why couldn’t there be a platform to facilitate microloans between those who need help, and those who want to help all over the world?
To hear Kiva Co-founder and President Premal Shah tell it, the opportunity was sitting at the middle of that why. After returning from a family visit to India, he pondered: “If eBay and PayPal allowed complete strangers to buy and sell from one another, why can’t you invest in someone you don’t know across the globe?”
That was more than a decade ago, when Shah worked at PayPal prior to launching Kiva. Upon his return from India, he shared his newfound interest with his managers and they encouraged him to continue researching the possibilities of microlending especially in developing countries. As Shah’s interest grew, he decided to work on the project full time with other members of Kiva's founding team – Chelsa Bocci, Matt Flannery and Jessica Jackley. Soon after, PayPal made a commitment that would prove to be essential to the fledgling organization’s success: to process every loan made through Kiva without charging any transaction fees.
Fast forward 12 years later, Kiva reached a milestone of enabling $1 billion in small loans to over 2.5 million entrepreneurs in over 80 countries.
In a conversation with Sean Milliken, Head of Global Social Innovation at PayPal, and Chelsa Bocci, part of the founding team and VP of Marketing and Community at Kiva, we hear the story of this remarkable milestone.
PayPal Staff: Kiva just hit its $1 billion funding milestone. How has this transformed the lives of Kiva's network of entrepreneurs?
CHELSA: It’s huge. $1 billion in loans translates to $1 million in loans every three days. From providing women with financial security for their families and communities, to giving farmers financial flexibility for unpredictable growing seasons, Kiva has facilitated unprecedented levels of entrepreneurship through a commitment to fight poverty by connecting people through lending amounts as small as $25.
The ripple effects are so inspiring – when women access fair credit, they gain decision making power in their homes and communities. Farmers can invest in equipment to increase yields or can access flexible credit that allows them to repay at harvest. Crossing $1 billion is really an incredible moment to reflect on how much good is possible when we come together.
How has PayPal contributed to Kiva’s mission?
SEAN: At PayPal, our mission is to democratize financial services and create a more inclusive global economy. We’ve served as a critical technology partner and collaborator for Kiva from the early days because of our shared belief that everyone should be able to participate and thrive in global and local economies, regardless of their financial situation.
Over the past 12 years, Kiva has helped millions of underserved entrepreneurs by giving them access to funds which they normally would not have received through traditional financial services. We are honored and proud to power all their lending activity because we know that, with each loan, we’re helping more people participate and thrive in the global economy.
CHELSA: People want to know their money is being used efficiently and going to the cause they believe in. PayPal’s continued support allows us to send every dollar lent on Kiva to the field, which is a big deal. More people have been able to follow their dreams because of this partnership.
What makes Kiva’s mission so special for you?
SEAN: I remain awestruck at the level of growth Kiva has seen in funding activity for small loans for entrepreneurs all over the world over the last 12 years. What started as an exercise in word-of-mouth, with a small group of friends inviting others to lend, has now scaled into an incredible social good model with global, local partners working in the communities of the entrepreneurs who use the platform to empower financial inclusion around the world.
I’ve made several loans through Kiva. I generally look for stories that speak to me to act in some way—whether it is a personal story, the vision they have for their business, or the product or service that I find particularly compelling. If there is a theme, I’ve focused on entrepreneurs that are trying to provide a livelihood for their families, in parts of the world for which I have a connection That may be a city in which we have an office location (San Jose), or a country that I came to know through PayPal’s support of relief and recovery efforts in the aftermath of a natural disaster: the Philippines (Typhoon Haiyan), Haiti (earthquake), for instance. I took a trip to Haiti a few years ago with American Red Cross and was overwhelmed by the kindness and positive outlook of its people in the face of extreme poverty and need. It’s truly inspiring to see how a little can go a long way for others.
CHELSA: I’m still constantly moved by the stories I hear from borrowers who made a real difference in their lives with a Kiva loan. Back in 2015, I visited several borrowers in Colombia. I even brought my dad along for the trip, which made it such a special experience. We met Antonia, who invited us into his home and introduced us to his wife Rosa, their three daughters, and two grandchildren who he called the “light of his life.” He used his Kiva loan to buy a machine for his woodworking shop where he makes wooden toys for children. The machine helped him increase production and double his sales! During our visit, he made us gifts on the machine to show his gratitude for Kiva and its community of lenders. From my experience of working with Kiva for more than a decade, this father represented everything that we work for. His work ethic and commitment to providing for his family was an inspiration. Even though our time with this family was brief, it was very special to me; I cried when we said our goodbyes. I'm so thankful my dad experienced that connection with me, which we call the "Kiva magic."
It’s stories like these that remind me of all the good that we do every day—even if we don’t always get to see it up close and personal.
Kiva borrower, Antonia, with his wife Rosa, their three daughters and one of their two grandchildren at their home in Colombia.
So, what’s next for Kiva and PayPal?
CHELSA: We’re looking forward to the next $1 billion, with a continued commitment to facilitate connections between strangers around the world through microloans, and building on the life-changing success we’ve seen thanks to the 2.5 million small loans made by our lender community.
SEAN: We’re currently introducing the Kiva U.S. loan program to PayPal small business merchants who don't yet meet the eligibility requirements for PayPal Working Capital (PPWC), our unique business financing program. The collaboration started with a small pilot in the San Francisco Bay Area last year and we’ll be rolling it out to twelve cities in 2017. It’s part of our commitment to helping small businesses thrive in every stage of their development.
This fall, we’re collaborating on our second annual customer and employee lending campaign. Last year’s campaign saw over 10,000 people make a microloan over the 10-day campaign and over $810,000 made available to entrepreneurs around the world.
We’re also supporting the launch of Kiva San Jose & Peninsula—Kiva's direct lending model that allows individuals to help crowd-fund 0% interest loans to small businesses in their community, with contributions starting at $25.
We will continue working together to find ways to support entrepreneurs and build a more inclusive global economy. On to the next $1 billion on Kiva!