Concerns Over Repayment of Loans

[Guest]

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[howard]

Message just received from Liz:-

Good news - I just received this update from Ben regarding WEDCO. 'Got their repayments sheet and posting it in the next few days. The Kiva fellow there has finished journaling on all businesses'

Howard

[Tatiana]

Wondering what is going on with Ebony.  My loan through Ebony is now six months after the end date, and it has yet to be declared defaulted.  A random sampling seems to indicate that newer loans (post riot) had a couple payments and haven't had any in months.  The older ones it has been a bit longer.  I suspect it is a liquidity issue for Ebony rather than that virtually all borrowers--both pre and post riot start dates--have been unable to make a payment in three months.

I am glad that I have FINALLY gotten access to the amount repaid so far.  However, for transparancy there ought to be either an update about Ebony having an extension or a default so that the 1.5% default rate reflects reality.

Colette

I just wrote Kiva with some questions about Ebony yesterday. I didn't have the courage to bring it up here but yes, I'm also wondering.

[cpbailey]

My loan through Ebony is now 6 months past the end of term.  There is no sign of life since June (a very small payment was credited then; the only one since January).  YET, it has neither been defaulted nor updates posted on the current situation.  To be consistent with Kiva's policy, it should be declared defaulted or have a Kiva update on the policy/circumstances that give why a delay is reasonable.  Otherwise, the appearance could be that waiting keeps the repayment rates falsely high.

I have no expectation that anything else will be repaid, but I like transparancy.

Colette

[Natasha]

Thankyou Colette for raising this concern.

I too have not received payments since June, for Ebony Foundation or FDM. Despite asking many times about the status of FDM,  have not received a clear cut answer regarding this MFI.

I hope that soon we will have some answers, if not payments, from all of the MFIs that seem to be having issues.

[wind5001]

I just don't get why they don't stick to their own terms. If they DEVIATE from them, well then I can understand if they give an explanation. Like:

"Hey, we know the 6 months past the term are over but we are still looking into the situation. Will get back to you with an update in 4 weeks" or so.

This is just the same old stuff as with the other MFIs that had major issues...

[cpbailey]

Oli,

I totally agree.  It is clear that Kenya has unusual circumstances after the riots, however, it seems that NONE of the loans, including those started in March AFTER the riots have had any payments.  I suspect this will be similar to Ecuador's situation.

Colette

[Tatiana]

Some time ago I wrote to Kiva with some questions about Ebony. This is part of the reply I got:

I won't be able to answer all your questions, because my coworkers who manage Kiva's partnership with Ebony are in the field right now.  In fact, they just visited Ebony a while ago, and I know we are hoping to release an update soon.

It worries me that Heather told us that  George Mwanga Onguso was making repayments for months, and none of those have been credited to the Kivalender accounts. The loan has been repayed in full now, and I am sure the Kivalenders will be repayed eventually, with all the attention this case got here at Kivafriends.

But I wonder, how many more Georges are there, making repayments, facing penalties if they are late?

I don't mind at all if people whose businesses are destroyed and can't make repayments don't have to pay back. In fact, I hope Ebony is kind enough not to push people beyond their limits. But it worries me that we don't get any updates, there are no repayments, and the only one client whose personal story we know made several monthly repayments, facing serious penalties if he was a few days late, and has now repayed his loan in full while the last repayment to Kivalenders was December 2007.

Since Ebony paused oploading loans at Kiva they have uploaded almost half a milion Euros at MyC4:

Provider Statistics     
MyC4 Partner Since:    16.04.2008 10:30 CET
Businesses Funded:    €403,560.00 in 81 Businesses
Repayments Received:    €24,754.94

The moderators may delete this post if they think it is inapropriate. I don't want to cause any trouble. But the situation has been bothering me for months.

It is not about the money, seriously, it is not, I have only one Ebony loan myself. But somehow the whole situation makes me a bit uncomfortable.

[cpbailey]

Actually, Heather came on a bit ago and said that his loan had been paid.  This wasn't the first time when he started the business, but some time AFTER that.  So...once again, where did said money go?

Colette

[mejane]

Conditions in Kenya do not seem to be any better for one of the other MFIs also.  I received the following update:

"Dear Kiva Lenders: We would like to give you an update on your loan(s) managed by Kiva’s Field Partner PEMCI in Kenya.  As you may know, the region in which entrepreneurs working with PEMCI live was severely affected by the riots and civil unrest that took place in Kenya earlier this year. Many, if not all, of PEMCI's entrepreneurs were adversely affected by this event, and currently PEMCI has a very high portfolio delinquency rate. Kiva staff have been in continual contact with PEMCI's Executive Director, Margaret Karuri, to assess the possible impact the civil disturbances may have on Kiva lender loans.  PEMCI is making every effort to work with their clients to fully understand their unique situations and how it has affected their businesses and their ability to repay their loans. However, we do expect that there may be situations where loans managed by PEMCI will go into default, as clients (i) may be unable to be located, (ii) clients' businesses may have been destroyed, and (iii) clients may have otherwise suffered such extreme losses that their debt is causing them unusual difficulties. At this time we are providing PEMCI with what support we can, and PEMCI is encouraged knowing that they have supporters around the world in Kiva Lenders. Although we realize the entire Kiva community is eager to help entrepreneurs in Kenya, we ask that you please refrain from requesting to “forgive” your loan at this time, because PEMCI will be evaluating each entrepreneur’s statusindividually and we would like to cooperate with PEMCI in following the standard procedures to assess the situation. As the situation develops, PEMCI will provide additional overall updates to lenders as they can; however, we wish to convey the expectation that individual entrepreneur updates will likely be difficult to obtain.  Thank you for supporting Kiva Entrepreneurs through PEMCI.  Most Sincerely, Kiva Staff"

One of my loans was funded and dispersed before the riots.  That one is more than 90% repaid.  However, one was posted and funded in June of this year.  To date, that loan has not made a repayment.  I guess the difficult question..... "where has all the money gone?" remains unanswered. 

Jane

[howard]

Message just received from Liz:-

Good news - I just received this update from Ben regarding WEDCO. 'Got their repayments sheet and posting it in the next few days. The Kiva fellow there has finished journaling on all businesses'

Howard

I posted this on 12 September. The 'few days' is long past, and, as far as I know, nothing has come of it. Has anyone seen anything? Should we follow it up with Liz on, say, 12 October?

Howard