KIVA – The Power of Social Media

Lynn Jeffries    October 22, 2015


Kiva is a non-profit organization, launched in the San Francisco area, that allows people to lend money via the Internet to low-income / underserved entrepreneurs and students in 82 countries.

Title:  Kiva – The Power of Social Media

Industry: Microfinance

Contact: Community Support Team –

Web References: Kiva.orgWikipedia


Engaged couple Matt Flannery and Jessica Jackley launched Kiva in October, 2005.

The goal was to provide microfinance  loans to individuals in the developing world from those in the developed world.

They picked 7 entrepreneurs in Africa that required loans in value of $3,500 and sent an e-mail to 300 family and friends from their wedding list to gauge their reaction.

Within a few days all 7 entrepreneurs were fully funded.

Family and friends loved the idea of providing loans, instead of donations.  It made them feel connected to someone on the other side of the world. They also felt good knowing their small donation from home had a huge impact in developing countries.

The minimum amount of a loan is $25.00 with a $2.50 voluntary donation to Kiva so they could run the business.

Within six months all loans were paid back in full.

Lenders could re-loan the amount to a new entrepreneur or withdraw their money.

With the success of family and friends, Jessica e-mailed her contact in Africa asking if he could locate another 50 entrepreneurs to try it on a larger scale.

In October, 2005 they sent a press release to 10 bloggers.  Out of the 10 only 1 blogger picked it up Daily Kos

Thankfully Daily Kos had about 10,000 subscribers per month and their subscribers loved Kiva’s platform.  Within a few hours of posting all 50 entrepreneurs had their loans funded.

Kiva was on to something big!!!!


As they approved new microfinance organizations globally and added new entrepreneurs, someone at PBS read the blog and decided to broadcast a story on them with their show Frontline World

The broadcast was a huge hit with viewers, it generated so much traffic to Kiva’s website that it was shut down for 4 days!!!

Once it was back up they had over $250,000 worth of loans waiting to be processed.


Since a 100% of the loans went directly to the borrower, Kiva did not have a lot of money to spend on marketing campaigns. They depended on organic growth through word of mouth, the internet,  field partners and success stories entrepreneurs.

Their work received accolades from people with a large number of followers on the internet along with traditional newspapers:

President, Bill Clinton,

“If you look at, people with a very modest amount of money can make a huge positive impact all around the world. There are so many people who want to give but don’t really know how to do it. Through, people around the world can become micro-bankers to developing world entrepreneurs, who have their own ideas, so we can give them a chance to raise their kids with dignity, send their kids to school, and in troubled places like Afghanistan we can marginally increase the chance that peace can prevail, because people will see there is a positive alternative to conflict.”

Author Seth Godin:

“..this is a great first step in opening up bottlenecks.”

And the Huffington Post:

“ allows people the very American satisfaction of both helping someone and getting their money back.”

To develop a sense of community Kiva created Lending Teams on their website.  Lending teams are self-organized groups built around common interests, school affiliation or location. It gives lenders a chance to see who their friends, family and colleagues are supporting.

The team Atheists, Agnostics, Skeptics and Freethinkers have a slight lead over Kiva Christans but Guys holding fish are starting to make some traction.


With the success of the Lending Teams, and a few tweets from well-known people such as the founder of LinkedIn Reid Hoffman who sits on Kiva’s Board of Directors, Kiva  has anywhere between 10,000 to 40,000 new lenders per month.

Corporations also wanted to get on board.

Google awarded Kiva with a 3 million dollar Global Impact Award to create Kiva Labs, along with providing free AdWords.

Hewlitt Packard provides free cloud based training programs for entrepreneurs in rural areas along with access to e-health solutions.

Capital One is currently offering a loan matching program.

There are many other corporations that work with Kiva.

Kiva introduced new products to allow lenders to focus on lending money in an area that directly resonated with them.  To date some of their new products are:


Both Kiva City Program and Kiva Zip have a direct impact on businesses in the USA.

Kiva City Program provides local business owners and entrepreneurs in economically hit US cities with the opportunity to crowdsource loans. Some of the city locations are: Detroit, New Orleans, Pittsburgh among others.

Kiva Zip

Kiva Zip uses an entrepreneur’s network as a measure of creditworthiness.

Borrowers need to be recommended by one of 700 recognized Kiva Trustees. They also need to approach family and friends to start their fundraising. Once they’ve reached a designated threshold, they are featured on Kiva’s website so other lenders can help meet their target amount.

In many instances, corporations match the lender’s amount.

Besides focusing on entrepreneurs or businesses in the USA, the only minor difference between these two programs and all other programs is Kiva disperses funding directly.

I had a chance to contact Kiva to  ask them a few questions on their new business models:

1) How did you develop a business model to include loans to those in the USA?  It wasn’t until the creation of Kiva Zip that we explored a new business model, but we thought about it in both the US and in Kenya.  This direct model that was created, was meant to explore two primary innovations:

1) Lowering the cost of capital by leveraging new technologies that would ultimately create a more direct link between borrowers and lenders

2) Increase the connectedness between borrowers and lenders, allowing them to communicate with one another

2) Was there an expressed interest in new products on your social media accounts or were you contacted through smaller financial organizations?
We were connecting with people on the ground both in the States and Kenya who were interested in getting loans where we didn’t have MFI partners to facilitate the lending, so they were perfect candidates for the direct/Kiva Zip model. I don’t think many people came to us via social media to borrow, though we do get people through social media interested in lending.)

3) How was the decision made to offer this new product? 
We wanted to explore new ways of creating impact.  This made the most sense.

4) Since implementing this have you noticed an increase in funding from Americans to your organization overall? Yes — with an increased focus on supporting entrepreneurs in the United States we naturally drive more lending in the United States.

5) As a business what has the benefit to Kiva been?More lenders = more money for Kiva to make impact.

6) Are there any other countries you are currently working with or any new products being developed? Not currently, though it’s something we want to do after we solidify our program domestically. 

5 Lessons for others:

  1. Create meaningful partnerships.  In addition to the microfinance organizations, Kiva also has partnerships with PayPal (free transactions), Google (free traffic) as well as with Yahoo!, Microsoft and YouTube.
  2. Catalyze and support evangelism. Like Apple, Harley-Davidson, and Netflix, evangelism starts with a great product.
  3. Find a business model. Kiva’s model is a minimum $2.50 voluntary fee that lenders pay when checking out their shopping cart.
  4. Focus on free marketing. Kiva’s success started with an e-mail to friends and family along with 1 press release.
  5. Ignore the naysayers.  Matt and Jessica received a lot of advice that you can’t send money around the Internet, that Kiva couldn’t scale beyond a few African villages; that a non-profit couldn’t offer an investment product

Since launching 10 years ago, Kiva has disbursed $769 million in loans to 1.7 million borrowers with a repayment rate of 98.5%.

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