In the municipality of Amaga located in Antioquia Department lives Erasmo Antonio, a 67-year-old micro businessman who started his own micro business thirty years ago to support his family. Now, it’s a family business for all of them and a source of employment. They manufacture and sell candles and large votive candles in various towns in southeast Antioquia.
He is asking for a loan at present to invest in working capital. He will buy raw materials like candle wicks, cellophane paper and paraffin because he has to start getting his stock inventory ready for the Christmas season's Day of the Little Candles [one of the most observed traditional holidays of Colombia. It is celebrated on December 7] .
En el municipio de Amaga, situado en el departamento de Antioquia vive Erasmo Antonio, un microempresario de 67 años de edad, que desde hace 30 años creo su propia microempresa para sacar adelante a su familia, y ahora es el negocio de todos juntos y su principal fuente de empleo, fabrican y venden velas y velones en varios municipios del Suroeste antioqueño.
Actualmente solicitó un crédito para invertir en capital de trabajo, como comprar materia prima pabilos, papel celofán y parafina ya que debe ir preparando su inventario para la época y el día de las velitas en Navidad.
This loan is structured on Kiva as a bullet loan, which means a single payment is required at the end of the loan term. By Colombian law, Kiva's partner Interactuar is required to offer borrowers loans with a variable interest rate that fluctuates with the market rate. Because fixed monthly payments are applied first to interest and then to principal, Interactuar is unable to predict upfront what portion of each repayment would go towards the loan principal. This creates a challenge with Kiva's system, which doesn't allow for unpredictable principal payments, and can result in some Interactuar clients appearing falsely delinquent. To remedy this, the loan has an end-of-term repayment plan on Kiva, but the borrower will continue scheduled monthly repayments to Interactuar, who will then pass along the principal amount to Kiva lenders. This means that you may see repayments made on this loan throughout the repayment term, as opposed to receiving repayment in full at the end of the loan term.