Silvia has had to face several problems because there are several criminal gangs in the zone where she’s located that extort and charge protection fees from merchants which led to her having to dismiss her employees that helped her and decrease her level of production. She changed from working all week in her workshop to just doing so on weekends and added to her income by being employed as an operator in another shop during the week. She did all this because she was forced to lower her profile to avoid being subject to any more danger from the criminal gangs.
She’s currently requesting a loan to buy supplies at wholesale (fabric, thread, buttons, elastic) taking advantage of available discounts for cash sales which will make it possible for her to have more variety to offer her customers and thus increase production since the second semester of the year means more orders that increase her income.
This allows her to dream with reaching her goal of opening a store in the medium run where she can sell her products and once again generate employment opportunities improving the quality of life of her family and of many others who take part in her work’s development.
More information about this loan
By funding this loan, you are promoting entrepreneurship in remote regions, including areas recovering from guerilla warfare in Colombia, and helping to reverse the rural exodus which occurred in the past decades when a the rural population fled their countryside homes for the safer cities.
This Kiva loan was created by Kiva's field partner Interactuar specifically for Kiva funding, in an effort to reach more borrowers in rural areas. Most of the Interactuar's lending operations are focused in urban parts of Medellin. But this loan product is designed to provide working capital to riskier agricultural businesses who have been traditionally excluded from the finance sector.
Important InformationThis 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.
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