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Kiva partners outperform key global benchmarks in the 2023 Microfinance Index

February 29, 2024
Julita received a loan through Kiva Lending Partner NWTF to buy supplies for her bicycle transport business.
Julita received a loan through Kiva Lending Partner NWTF to buy supplies for her bicycle transport business.

In this article:

  • 60 Decibels released its second annual Microfinance Index report, which reveals key insights into the outcomes of microfinance services around the world. 

  • Kiva Lending Partners included in the Index outperformed global benchmarks for several key indicators, highlighting Kiva’s focus on partnering with high-impact financial service providers to ensure positive outcomes for the borrowers we serve.

Kiva is happy to share the release of the 2023 60 Decibels Microfinance Index, the microfinance performance report based entirely on data from the people it serves.

The annual report reveals key insights into the impact of microfinance for its end users, providing an essential view into the lives of the some 174 million people who utilize financial services through microfinance institutions around the globe.

By providing insights into the institutions and practices that are yielding the strongest social outcomes for clients, the report helps to establish higher standards for impact on client wellbeing across the industry.

The data from the comprehensive study offers encouraging insights into the benefits that can be provided by microfinance, with improved quality of life, an increase in business income, and higher confidence amongst some of the positive outcomes for borrowers.

What changed this year for the Microfinance Index? 

In 2022, Kiva was one of 21 founding partners that worked with 60 Decibels, an independent social impact measurement company, to build the first industry-wide assessment of how microfinance affects individuals. This crucial investment helps us learn how borrowers are being impacted by the loans that are fundraised through Kiva, and reveals key insights that help our partners improve their products and services.

The 2023 study reached even more of the microfinance industry than the previous year’s inaugural report — with over 32,000 clients interviewed from 114 financial service providers (versus almost 18,000 clients from 72 organizations in its first year).

The financial service providers (FSPs) in the 2023 dataset collectively serve more than 84 million clients in 32 countries, representing about 48% of the global microfinance market.

“These microfinance institutions are often embedded in communities, and they have built deep relations of trust with their clients,” reads the report, highlighting the impact that microfinance institutions can have. “They are uniquely positioned to increase financial resilience, help families withstand economic shocks, grow businesses, improve household wellbeing, and empower women.” 

“These microfinance institutions are… uniquely positioned to increase financial resilience, help families withstand economic shocks, grow businesses, improve household wellbeing, and empower women.”

Kiva partners also represented a greater proportion of those interviewed this time around, with 16.6% of the microfinance institutions in the 2023 Microfinance Index (MFI) being Kiva Lending Partners, versus 12.5% of those surveyed last year. 

Laura and her husband borrowed through Kiva Lending Partner CACMU for their business selling typical Colombian food.

LAURA AND HER HUSBAND BORROWED THROUGH KIVA LENDING PARTNER CACMU FOR THEIR BUSINESS SELLING TYPICAL VENEZUELAN FOOD.

60 Decibels outlined some of the key highlights from this year’s report, including the following: 

  • Borrowers have better outcomes when they have a longer engagement with their Financial Service Provider (FSP). 

  • Borrowers see additional benefits if they access services beyond loans — including financial services like savings accounts or non-financial services like education and training.

  • Microfinance provides significant positive impacts for women, including increased confidence and financial decision-making ability. 

  • Group loans show higher borrower satisfaction compared to individual loans. 

  • Despite many borrowers reporting improved quality of life and income, concerns about financial security and emergency expenses remain for some, indicating that client protection remains important as ever. 

For a detailed exploration of the findings, you can view the full report here.

Kiva Lending Partners outperform global benchmarks

“The loan I have requested has truly helped me a lot, I am very grateful.” 

Looking at data specifically for the Kiva Lending Partners included in the report provides encouraging signals that Kiva’s own evaluation systems have been working. We aim to partner with microfinance institutions who facilitate the most positive impact for borrowers, and the results of the microfinance index show that the Lending Partners in Kiva’s portfolio tend to outperform the global benchmarks established by the report. (The full list of Kiva partners included is provided at the end of this article.)

Here, we highlight nine key outcomes which are of particular focus for Kiva. In all of these outcomes, Kiva partners outperform global benchmarks. 

1. 91% reported an improvement in quality of life 

This metric measures the clients interviewed who agree that their quality of life has improved as a result of working with their FSP, and provides an indication that microfinance has contributed to overall better living conditions for clients. A vast majority of clients of Kiva Lending Partners agreed with this, with 42% saying their lives ‘very much improved’ (against a global benchmark of 30% who said their lives had ‘very much improved’). 

Some areas related to quality of life where a majority of clients saw improvement included: 

  • spending on home improvements

  • spending on children's education, and

  • the number and quality of meals that their family eats. 

Some Kiva Lending Partners far outperformed the benchmark, with as many as 72% of their borrowers reporting a ‘very much improved’ quality of life, as in the case of Humo, a microfinance institution in Tajikistan that aims to support vulnerable and underserved populations living in rural areas through financial and consulting services for small businesses.

2. 85% reported an increase in confidence

When asked ‘has your confidence in yourself and your abilities changed because of the FSP?’, a vast majority of clients of Kiva Lending Partners agreed, with 43% agreeing it had ‘very much increased’, compared with 30% across the portfolio of FSPs included in the index. 

This is one part of the ‘agency’ dimension measured in the Microfinance Index, which aims to understand the impact of financial service providers on decision-making and confidence. This also includes questions around the ability to achieve a financial goal and the ability to make decisions related to finances. The Microfinance Index found that women see greater improvements in agency, with outcomes between 4 and 6 percentage points higher than men. In addition, women were more likely to report an increase in confidence if they had accessed additional services beyond loans (financial and non-financial) from their FSP.

Friendship Bridge is one Kiva Lending Partner which offers additional services for its borrowers, primarily women living in rural areas of Guatemala who are characterized by extreme poverty. As well as loans, they offer education, preventive health services, and opportunities to develop leadership skills. They are seeing this translate into improved outcomes for women, with 47% of their borrowers seeing a ‘very much increased’ level of confidence. 

“What I’d like to learn more about is leadership, I’m looking forward to that. I have one employee right now, and would like to guide her and help her so that she may also one day have her own business.” - Lilian, Friendship Bridge borrower

Kiva Friendship Bridge photo.

Friendship Bridge clients in Guatemala

3. 73% reported an increase in savings

One of the other dimensions of the analysis provided in the report, and one of the most important for Kiva, is ‘resilience’, in which 60 Decibels aims to measure the degree to which clients are prepared for an unforeseen economic shock. Having savings can help borrowers be more resilient, and 73% of those surveyed from Kiva Lending Partners said they had been able to increase their savings as a result of working with their FSP. And for some this change was significant, with 21% of respondents saying their savings had ‘very much increased’, outperforming the global benchmark of 14%. 

4. 48% reported an increase in their ability to fund an emergency expense

Another aspect of ‘resilience’ is the client’s preparedness to fund an emergency expense. To measure this, respondents were given a scenario in which they’d need to come up with a specific amount of money (which equated to one twentieth of the Gross National Income per capita in their local currency) within the next month. When asked how easy or difficult that would be, 48% of clients of Kiva Lending Partners said it would be easy, with 21% saying it would be ‘very easy’. 

Clients were also asked if their ability to face an emergency expense had improved as a result of working with their FSP, and 76% of those surveyed from Kiva Lending Partners agreed that theirs had.

Not surprisingly, the ability to fund an emergency expense goes hand-in-hand with savings, and 60 Decibels found that 30% of clients who reported an increase in their savings affirmed a 'very much improved' ability to face an emergency expense, compared to only 9% of clients whose savings decreased or did not change.

5. 88% reported an increase in their ability to manage their finances

In another measure of resilience, 60 Decibels asked if clients' ability to manage their finances had changed since working with their FSP. 88% of clients surveyed from Kiva Lending Partners agreed that theirs had; with 38% claiming it had ‘very much improved’, versus a global benchmark of 25% for this response. 

Resilience is further strengthened when clients use additional services beyond credit. 60 Decibels found that clients who used additional services such as savings accounts or training from the FSP were more likely to report an increase in savings and an improved ability to manage finances, compared to those who did not (79% and 90% compared to 64% and 82%).

6. 55% reported a decrease in time spent worrying about finances

“The loan I have requested has truly helped me a lot, I am very grateful.”

An important part of the report is its focus on client protection and wellbeing, as it helps us to understand the current risk of overindebtedness for clients. One of the questions used to measure this was ‘Has the amount of time you spend worrying about finances changed?’. Over half of the respondents from Kiva’s Lending Partners reported a decrease, with 17% saying it had very much decreased (slightly above the global benchmark of 16%). 

For one borrower from Kiva Lending Partner CACMU, Rosa, her loan not only helped her business survive the pandemic, but she was able to use some of the profits gained from increased sales to pay for medical treatment for her ailing health.

“The loan I have requested has truly helped me a lot, I am very grateful,” she says. 

A Kiva loan to Rosa helped to buy avocado plants in order to increase sales in her business.

Rosa took a loan through Kiva Lending Partner CACMU for her avocado business

7. 89% reported an increase in their ability to achieve a financial goal 

Almost 9 out of 10 clients surveyed from Kiva Lending Partners reported an increase in their ability to achieve a financial goal. Here again Kiva Lending Partners outperformed the global benchmark, with 38% of respondents saying their ability had ‘very much improved’, versus 26% for the full portfolio. 

The top three financial goals cited by clients were:

  • investing in their business

  • increasing their income, and 

  • improved ability to afford a house or property (including land, renovations, or rent).

8. 89% reported an increase in business income 

As borrowers are able to use their loan to invest in their business, this gives them greater opportunities to grow their business — often opportunities which would not have been possible without the capital they need to hire more employees or purchase additional supplies, machinery, equipment, or other assets that any business needs to achieve more scale.

Almost 9 out of 10 borrowers from Kiva Lending Partners reported that they’d seen an increase in their business income as a result of their loan, with a third of (33%) saying their income had very much increased (against a global benchmark of 22%). 

9. 15% reported an increase in number of paid employees

While many borrowers responding to the 60 Decibels survey are family-owned businesses without additional employees, a significant proportion of borrowers (15%) were able to hire new paid employees as their businesses grew. In this area Kiva Lending Partners far outperformed the global benchmark, which sits at 8%. Before receiving their loan, borrowers from Kiva Lending Partners had on average 3.1 employees. After receiving their loan, this number had increased to an average of 6.5 employees. 

This highlights the ripple effects of microfinance, as growth in these businesses encourages additional employment within their communities, among other benefits.

More to come

With a report this in-depth there are so many insights to gain, and Kiva will continue to assess the results and the possibilities for improvement within our portfolio and the industry as a whole. 

We’re also excited to continue to grow the breadth of this study for the 2024 Microfinance Index, with more Kiva partners included. Together with 60 Decibels, we aim to move towards greater measurement of outcomes, with the goal of encouraging the microfinance industry as a whole to create bigger and more positive impact.


*The Kiva.org Lending Partners included in this year’s report include: 

  1. Agora Microfinance Zambia (AMZ)

  2. Baobab Plus Côte d'Ivoire

  3. Cooperativa de Ahorro y Credito Mujeres Unidas (CACMU)

  4. FINCA Uganda

  5. Friendship Bridge

  6. Fundacion ESPOIR

  7. Pro Mujer Bolivia

  8. Hattha Bank

  9. HUMO

  10. Juhudi Kilimo

  11. Negros Women for Tomorrow Foundation (NWTF)

  12. Pro Mujer Nicaragua

  13. UGAFODE Microfinance

  14. VisionFund Ecuador

  15. Vision Fund Rwanda

  16. Vision Fund Senegal

  17. Vision Fund Uganda

Kiva Capital partners included in 2023's report: 

  1. Advans Nigeria

  2. KOMIDA 

  3. UGAFODE Microfinance