Large, Languishing Group Loans?

[Guest]

.

[KarenS]

I've only on Kiva for about a month, but I've noticed lately that there are several larger group loans that have less than 20 days, or even 15 days, left to fund.  (When I first signed on, I think the oldest loan had 24 days left.)  The loans I'm talking about are for over $3000.  The three I decided to lend money to today were for $4600, $3100, and $3075. 

That group loans are more efficient, valuable to the community, and since the members of the group support each other, they seem more likely to succeed.  But I'm wondering--are there too many big loans out there right now?  If everyone lends $25, it would take 120 people to finance a $3000 loan. 

Is this a new trend, or is it typical, or... should I just keep my worries to myself and keep lending money? 

[Canadian Here]

Karen:

Welcome to KIVA! 

Many of us have the same thoughts and concerns. Some of us voice them, some of us don't. However, you're right. There are a lot of very large group loans on the board right now, which require very substantial amounts to fully fund. While most of us put up our $25.00, thankfully some people are able to fund to a greater extent and choose to do so. I predict that some of us are going to have to dig a little deeper than our usual $25.00 to get them moving. I have often come back and donated another $25.00 to a business for this very reason. That being said, people should do what they are comfortable in doing: no more and no less. I think asking questions is heathy and just keeping your worries to yourself and "keep lending money", is not. If you are comfortable with what you are doing, keep doing it. It's your money and your comfort threshold.

The worst case scenario is that KIVA will refund your money (and that of everyone who has contributed to the particular loan) if a loan is not fully funded before the expiry date. However, that has not yet happened on KIVA. Somehow all the loans have always been fully funded, before they expire.

I hope that is helpful.

Lorna

[Diane R]

Much of the literature about microfinancing has a lot of good things to say about group loans like these, so even if they take a few days longer to fund, they're worth our support.  I don't have the citations handy right now, but I know some Kiva staffers have said, here and elsewhere, that they were starting to work with MFIs that feature mostly group loans (which are also more cost-effective for the MFIs to administer!).  That trend (and the consequently larger loan amounts) combined with the up-tick in number of loans available in total (trending upwards of 450 now     ) would have the effect of making these large group loans take longer to fund.

But so far, no loans have gone longer than "10 days remaining" -- so far, even the "least exciting" loans have not gone into single-digit days remaining.  So I think it's still not anything to worry about!

Welcome to Kiva and KivaFriends. 

--Diane.

[KarenS]

Thanks for the welcome, and the reassurance!  I'll keep watching for older loans that are financing.   

[cpbailey]

Karen,

I believe that having this many loans becomes a bit too much for people to wade through.  The total dollar value of loans listed should in some way reflect the amount of money people are putting into loans. Initially when the quantity of loans went to 300, the weekly total went up.  Gradually the quantity approached 400, and gradually loan volume returned to $700k or so a week.  Then it dropped again below where it was before.

One of the reasons I did the challenge was to CHANNEL money into a few loans and close them.  In Paraguay, loans disburse within a couple days.  Having lots of partially filled loans instead of rotating through and filling loans makes NO sense.  This is why I started with, featured and have two in Paraguay.  I am thinking two of your loans are part of the challenge as the amounts are the same.  Thank you, whether deliberate or not!  I will be doing more challenges to channel things.  Group loans will be a large part of it!

Colette

[redstarr]

One way to make sure that the older loans are funded quickly is to start your search when you are searching for a borrower by sorting from "Old to New".  That will show you the oldest loans first.  If there's something that's stagnating a little that you want to get in on,you'll be sure to see it that way. 

Oh, and WELCOME 

[Canadian Here]

Thanks for the welcome, and the reassurance!  I'll keep watching for older loans that are financing.   

Karen:

You can also pick one or two of the large group loans to which you have already lent and re-loan to them which would help move them along. Pick the ones that are closest to being fully funded for maximum impact.

Lorna

[Jan & John]

I've only on Kiva for about a month, but I've noticed lately that there are several larger group loans that have less than 20 days, or even 15 days, left to fund. 
Is this a new trend, or is it typical, or... should I just keep my worries to myself and keep lending money? 

Hi KarenS and welcome to this weird but wonderful place where strangers are your friends...

I learned very quickly here that you don't have to keep your worries to yourself.  I also have a few loans that have been taking some time to fund and I keep checking them to see what's happening - one is a large Bolivia one that a few KF went in on... I have blown my budget this month or I would help move it along http://www.kiva.org/app.php?page=businesses&action=about&id=47408

Then I think - well - a lot can happen in 17 days - so I wait a bit more.

I will trust the group when they say no loan has gone unfunded yet - it's just that feeling that the money pledged is sitting there not helping anyone yet - sigh - perhaps you are right and the groups have grown too large? We wait and wonder - but we don't worry
anyway - welcome Karen, hope to hear from you again
jan

[Paula-from-NZ]

I too am concerned about some of the "older" loans still available.  I have 4 loans due to complete next month and I hope to with the credit put that directly to some of the oldest loans in the system and I'm guessing I won't be the only one aiming for this strategy   

I chose this one just the other night for that reason exactly http://www.kiva.org/app.php?page=businesses&action=about&id=45718 

[Kay]

I haven't been following things too closely, lately (just too busy), but I recall more than a year ago--when there were many fewer lenders and many fewer loans--that for "languishing" loans, that whenever they reached some sort of "tipping point"--which I estimated to be perhaps 70% funded--that the rest of the funding would come relatively quickly.  I don't know that this is the case now, or not.