This was my second time attending the annual Lend for America conference, so while the sessions were informative and helpful, discussions with leaders in between the sessions provided insightful advice more specific to where our club is at the moment. The opportunity to network and share information in person with leaders who have faced and overcome similar challenges in operating their campus MFI, on top of the informative workshops, was what made the long travel for a short conference worthwhile. I have condensed a couple of the conversations that I had outside of the workshops into two quick take-aways.
Take-away #1: Establish steps in the vetting process that will move us out of gray areas into black or white areas. Establishing clear criteria that would provide a decisive “yes” or “no” even at the first meeting with a potential borrower will become useful and more necessary as we hear from more interested borrowers – we will probably have a better sense of what these decisive factors are as we interact with more business-owners. Ultimately, the interested borrowers’ time is also valuable, so we should identify and eliminate any “artificial hurdles” if there are other indicators that this loan will not work out. One or two documents and meetings would be ideal. The most important factors for evaluating clients initially seems to be their credit score and how they have been repaying others over the past 12 months, as well as the loan payment-to-income ratio (see Credit Karma).
Take-away #2: Some tips to keep in mind as a Kiva Zip trustee. The borrowers most successful on Kiva Zip are typically the ones who sell products because they present something tangible to potential lenders online. Several indicators of a good potential borrower include e-mail responsiveness, a cooperative attitude, and operation of a Facebook page or list-serve that they use to reach out to a network of contacts. It is also important for the loan to be time sensitive – there should be a good reason that they need it right now. Good photos are crucial, so we want a great photographer working with our clients. Having someone in charge of managing a partnership with a small government organization can be useful because they come across small businesses very frequently. It is very important to establish a good vetting process early on, so we should not be in a rush to endorse the first couple clients. A Kiva Zip trustee that I spoke with at the conference said that it typically takes them up to three months to endorse a borrower.
All in all, while this has been a crazy weekend for the five of us (which required more modes of transportation and hours of traveling than should be necessary within a span of three days), I think we come back enriched through the informative sessions and interactions with leaders in other campuses.
-Kayoung Lee ’16