Update: June 13, 2011
As of June 10, 2011, BRAC Sri Lanka had $5,361 in loans on Kiva in arrears. As a result, its delinquency rate as expressed on the Kiva website was 98.10%. Kiva has received a full repayment for BRAC Sri Lanka’s outstanding balance. These funds were applied to corresponding lender accounts, and full repayment on all applicable loans made. BRAC Sri Lanka no longer has an outstanding balance to Kiva lenders.
When Kiva and BRAC Sri Lanka began their partnership, the Central Bank of Sri Lanka issued an approval for Kiva to provide BRAC Sri Lanka with funding subject to several conditions, including the requirement that all funds be raised prior to May 5, 2010. Kiva and BRAC Sri Lanka sought an extension of this approval but have not received a response from the Central Bank of Sri Lanka. As a result, Kiva is closing the organization as a Kiva field partner.
Over the lifetime of our partnership, Kiva lenders have raised $54,300 to support Sri Lankan entrepreneurs. Of this amount, 100% has been paid back.
We would like to thank the many Kiva lenders who made this possible, as well as BRAC Sri Lanka and BRAC itself. Kiva continues to proudly work with BRAC in Uganda, South Sudan, Liberia, and Sierra Leone. We are excited to continue to offer lenders the opportunity to lend to other BRAC borrowers around the world.
BRAC Sri Lanka continues to perform strongly and serve many of Sri Lanka’s poor and we look forward to the day when we will be allowed to work with them again. For more information on BRAC Sri Lanka, please consult BRAC’s website at http://www.brac.net/content/about-brac-sri-lanka.
Update: June 3, 2011
BRAC Sri Lanka currently has $5,369 in loans on Kiva currently in arrears, out of a total outstanding portfolio of $5,472. As a result, its delinquency rate as expressed on the Kiva website is currently 98.11%.
BRAC Sri Lanka had been working with the Central Bank of Sri Lanka on two matters:
- Enabling BRAC Sri Lanka to fundraise on Kiva by getting an extension on the original agreement and,
- Enabling BRAC Sri Lank to remit funds to Kiva lenders, by getting borrower repayments cleared through the Central Bank.
BRAC Sri Lanka's existing approval to receive new foreign funding from Kiva has expired, and the Central Bank of Sri Lanka has not responded to requests for an extension. As a result, BRAC Sri Lanka is not able to post new loans to Kiva.
BRAC Sri Lanka is continuing to work to receive approval from the Central Bank of Sri Lanka to remit funds to Kiva for amounts due. As per previous partner updates, BRAC Sri Lanka was not allowed to remit such funds until they had been in Sri Lanka for at least one year.
Given the above situation, Kiva does not expect BRAC Sri Lanka to post new profiles to the Kiva website in the near future. We will keep this page updated with further updates as information becomes availableUpdate: June 16, 2010
In February 2010, Kiva began its official partnership with BRAC Sri Lanka with the first Kiva borrowers from Sri Lanka fundraising on Kiva.org. In order to work in Sri Lanka, Kiva and BRAC Sri Lanka had to obtain the permission of the Central Bank which was received in May 2009. The Central Bank of Sri Lanka set a variety of conditions on the partnership, many of which are explained below, and one condition was that all funds enter the country within a year of the initial Central Bank approval.
Kiva and BRAC Sri Lanka have been working to receive an extension on the agreement but have not, to date, been successful in receiving an official response. As such, Kiva is refunding loans fundraised after 5 May 2010 (official date of agreement expiration) while both BRAC Sri Lanka and Kiva seek an official extension of the agreement. Updates on the partnership with BRAC Sri Lanka will be posted to the partner page as they become available. Original Partner Description
BRAC Sri Lanka launched operations in early 2005 following the tsunami that devastated coastlines across South and Southeast Asia. Initial activities focused on the provision of emergency relief for communities affected by the tsunami, including medical assistance for the injured, cleaning and disinfection of water wells, installation of latrines, and distribution of stipends and school materials for children. In May 2005, the institution launched its sustainable livelihood development program providing grants and loans for the re-establishment of sources of income that had been lost or severely damaged.
From its humble beginnings, BRAC Sri Lanka has grown to become the second largest NGO-microfinance institution in Sri Lanka serving 50,000 borrowers through a network of 55 branches spread across four districts. Over the next three years, the institution plans to expand its area of operation and expand its network to 100 branches and 150,000 borrowers.
In order to accept funds from Kiva lenders, BRAC Sri Lanka had to receive approval from the Central Bank of Sri Lanka. As part of their approval, the Central Bank of Sri Lanka set special conditions on funds from Kiva lenders:
- Kiva funding can only be used for borrowers below the Sri Lankan poverty line
- BRAC Sri Lanka should provide significantly reduced interest rates to borrowers receiving Kiva loans
- The Central Bank of Sri Lanka also required that Kiva funds must remain in Sri Lanka for no less than 12 months.
Even though the Central Bank of Sri Lanka requires that funds from Kiva lenders must stay in Sri Lanka for at least 12 months, we believe that we can accommodate timely repayments to Kiva lenders.
In order to minimize the number and expense of wire transfers across national borders, Kiva uses a billing system called “net billing.” This means that, for any given month, we subtract the amount of repayments that a Field Partner owes to Kiva lenders from the amount that a Field Partner fundraises for entrepreneurs on Kiva.
If the balance is positive, that means that the Field Partner has raised more money on Kiva than they need to repay, and we use those raised funds to credit your lender account with the repayments due to you.
With this system, Kiva can work with partners like BRAC Sri Lanka that disburse loans repaying monthly but where Kiva lender funds can’t flow back out of the country for a year. This is, of course, only possible when all goes right. There is the possibility that BRAC Sri Lanka has fewer than expected Kiva borrowers in one month and owes us funds. In a worst case scenario, it may take up to 12 months to get Kiva lender funds out of Sri Lanka.
We are piloting this new arrangement with BRAC Sri Lanka based on the organization’s strength and strong social mission, positive experience with other BRAC partners in Africa, and the unique opportunity to work in Sri Lanka (outside of this, we wouldn’t otherwise be able to work in Sri Lanka). Original Description from Partner
BRAC is registered as a NGO under Voluntary Social Services Organizations (Registration and Supervision) Act, No. 31 of 1980 as amended by Act, No. 8 of 1998 (Registration No: FL-94806). At the end of the first year of operations incorporated as a Guarantee Limited under Act, No. 17 of 1982 under the name, BRAC Lanka (Guarantee) Limited Company No. N (PBG) 247.
To address the crucial needs of Tsunami affected communities in Sri Lanka through rehabilitation and support and to provide them with sustainable livelihood assistance, BRAC Sri Lanka initiated its activities in May 2005 with its own finances and eventually expanded its program target beneficiaries with the provision of grants/loans for the livelihood activities. Besides livelihood activities for the tsunami affected communities, the organization has been providing financial support to deprived communities to eradicate poverty.