1. Kiva Overview for MFIs Raising low cost capital over the internet More information: partnerships@kiva.org partnerships@kiva.org "Revolutionising how donors and lenders in the US are connecting with small entrepreneurs in developing countries” “Making microfinance easier...Kiva’s website is easy to use, even for local Cambodian staff who haven’t used computers that long”

2. Social Investor Online platform MFI Partner Entrepreneur Kiva Introduction: What is Kiva? Kiva is an online platform that connects MFIs to social investors

3. 3 Internet Lender  Transparent (“I know where my money is going”)  Sustainable (“If repaid, I will re-lend to someone else”)  Affordable (“I only need $25 to change someone’s life”)  Unique (“I love microfinance and I want to participate”) Microfinance Institution  0% interest USD debt capital  No liability: Client loss borne by Internet Lender  Flexible repayment terms  Exhibit your work to an international audience Kiva Introduction: What are Kiva’s benefits?

4. 4 "If you've got 25 bucks, a PC and a PayPal account, you've now got the wherewithal to be an international financier." "Revolutionizing how donors and lenders in the US are connecting with small entrepreneurs in developing countries” "Kiva simply democratizes access to a worldwide microfinance movement that has been empowering the working poor for two decades." “Making microfinance easier...Kiva’s website is easy to use, even for local Cambodian staff who haven’t used computers that long” "Smaller investors can also make loans of as little as $25 to specific individual entrepreneurs through Kiva." Kiva in Year 1: Kiva has received wide acclaim in the press and blogosphere

5. 5 Early Results: Solid early progress and strong “internet-style” growth +13,500 internet lenders since Oct 2005 launch (avg loan per user = $75) Total Capital Raised via Internet Lenders

6. 6 Early Results: Strong base of supporters and advisors Institutional Supporters Advisory Board Members Geoff Davis, President & CEO Sam Daily Harris, Director John Hatch, Founder Free payment processing – eliminates Kiva’s variable costs Funding field R&D – reducing MFI administrative costs Free advertising and technology use – >$1M in value “Kiva Kiosk” Pilot in Store – big potential over long term Kiva featured invitee and speaker – honor for 1 yr old org

7. 7 Nicaragua Honduras Togo Senegal Bulgaria Gaza Uganda Kenya Tanzania Cambodia Since October launch, Kiva has expanded to MFIs in 17 countries. Early Results: Strong adoption with MFIs (now signing up 3 – 4 MFIs a month) Samoa Mexico Ecuador Nigeria Ghana Moldova Mozambique

8. 8 List of current Kiva partners (Nov 2006) 1.Microfund - Togo 2.Ebony Foundation (E-BF) - Kenya 3.Hluvuku-Adsema- Mozambique 4.Mikrofond EAD- Bulgaria 5.Lift Above Poverty Foundation (LAPO)- Nigeria 6.Microinvest LLC- Moldova 7.Kraban Support Foundation- Ghana 8.Fundación para la Vivienda Progresiva (FVP)- Mexico 9.Admic Nacional- Mexico 10.South Pacific Business Development (SPBD)- Samoa 11.Adelante Foundation- Honduras 12.Women Initiative to Eradicate Poverty (WITEP)- Uganda 13.Youth Self Employment Foundation (YOSEFO)- Tanzania 14.Credit MFI- Cambodia 15.Life in Africa Foundation (LiA)- Uganda 16.Mifex Microfinance Exchange- Equador 17.Women’s Economic Empowerment Consort (WEEC)- Kenya 18.Prisma Microfinance- Honduras / Nicaragua 19.Senegal Ecovillage Network (GENSEN)- Senegal 20.Regional Economic Development Center (REDC)- Bulgaria 21.The Shurush Initiative- Gaza / West Bank 22.Village Enterprise Fund / Uganda

9. 9 10% 18% 10% 0% 2% 4% 6% 9% 11% 13% 15% 17% Prisma – HondurasWEEC - KenyaCREDIT (World Relief) - Cambodia Industry Average 10%8% Kiva Factoring in staff administrative costs, Kiva’s capital is still 3 – 4x less expensive. 1-2% Cost of Capital Comparison MFI adoption of Kiva driven by cost savings Total Cost of Kiva Capital = [Financial Cost] + [Administrative Cost] + [F/X risk] – [Write Off rate]

10. 10 Should your MFI consider partnering with Kiva? Required Characteristics: Average loan size > $100 USD Cost of funds > 4% (in hard currency terms) Number of clients > 500 Required Capabilities: Ability to connect to the Internet Ability to digitally photograph clients Ability of one staff member to communicate by phone in English –By writing, Spanish, French and Portuguese is supported Ability to accept/manage currency risk of 0% interest USD loan Ability to accept debt capital from foreign investors and repatriate funds –i.e. no capital movement restrictions imposed by local government

11. 11 How Kiva Works Client Approve & Disburse Loan Post client data on Kiva Receiv e 0% interes t bulk loan from Kiva Repor ting: Note the delinq uencie s + final impac t Repay ment: Deduc ted from new loans Intern et Lende rs “fund” clients MFI $ MFI approves client and disburses loan – no change to MFI processes

12. 12 How Kiva Works Approve & Disburse Loan Post client data on Kiva Receiv e 0% interes t bulk loan from Kiva Repor ting: Note the delinq uencie s + final impac t Repay ment: Deduc ted from new loans Intern et Lende rs “fund” clients Loan Application Data Digital Photo

13. 13 How Kiva Works Approve & Disburse Loan Post client data on Kiva Receiv e 0% interes t bulk loan from Kiva Repor ting: Note the delinq uencie s + final impac t Repay ment: Deduc ted from new loans Intern et Lende rs “fund” clients Average time to 100% funding = 2.2 days

14. 14 How Kiva Works Approve & Disburse Loan Post client data on Kiva Receiv e 0% interes t bulk loan from Kiva Repor ting: Note the delinq uencie s + final impac t Repay ment: Deduc ted from new loans Intern et Lende rs “fund” clients Kiva aggregates 0% interest USD loan capital and wires it monthly to MFI

15. 15 How Kiva Works Approve & Disburse Loan Post client data on Kiva Receiv e 0% interes t bulk loan from Kiva Repor ting: Note the delinq uencie s + final impac t Repay ment: Deduc ted from new loans Intern et Lende rs “fund” clients 1. During loan term, MFI only reports the exceptions 2. End of loan term, impact summary required for each client

16. 16 How Kiva Works Approve & Disburse Loan Post client data on Kiva Receiv e 0% interes t bulk loan from Kiva Repor ting: Note the delinq uencie s + final impac t Repay ment: Deduc ted from new loans Intern et Lende rs “fund” clients MFI avoids wiring back repayments since Kiva automatically deducts the amount owed from new loan originations each month.

17. 17 Interested in a pilot / learning more? Contact: partnerships@kiva.orgpartnerships@kiva.org

18. 18 Appendix

19. 19 Current Landscape: Microfinance supply not meeting demand 1. CGAP, Microcredit Summit Campaign and UN Population Division data 2. Microcredit Summit Campaign data, 2006 3. CGAP and Microfinance Information Exchange survey of 191 MFIs ranked “Lack of funding” as the biggest constraint to growth, with biggest barrier to funding being “not enough contact with social investors / donors”. Borrowers (millions) Est. # of borrowers in need Est. # of borrowers reached  3,300 Microfinance Institutions (“MFIs”) reach 100M borrowers  This meets only 20% of the estimated demand  Most MFIs are small (90% have < 10k borrowers)  Reaching more borrowers requires access to capital -- a major growth constraint 500M 100M Microfinance Demand vs. SupplyMFIs by # of Borrowers Reached # of MFIs worldwide = 3,300 1 2 3

20. 20 Threshold scale needed to access commercial institutional capital # of MFI clients Time Catalytic Low Cost Risk Capital Conservative Institutional Capital With Kiva Without Kiva Kiva’s solution: Reduce MFI capital constraint enabling them to reach more borrowers Individuals can provide risk capital where commercial institutions won’t Emotional return reduces need for risk adjusted financial return No overhead cost structure to support (vs. bank) further reduces need for return Until MFIs achieve a certain scale, capital is a major constraint to growth

21. 21 A Vision: World’s Largest DB of Micro-Entrepreneurs