September 11, 2011
 
As part of an ongoing effort to fully migrate risk ratings to our new and enhanced risk rating system, Kiva has conducted a re-assessment of the level of risk posed by this institution.
 
During this re-assessment, our analysts were able to gather updated operational and financial information about the institution, as well as speak with key members of the staff. 
 
The information gathered during this process, together with the Kiva's new risk rating system and half-star support, has led us to revise VFC's risk rating from 4 to 3 stars. The analysts have found that VFC's risk variables, reviewed in the new risk rating model, were most representative of a 3-Star rating.
 
We have prepared a blog post with more information on Kiva's new and enhanced risk rating system, along with a chart showing the relative magnitude of the overall changes for Kiva's portfolio.  To view that, please go here: http://www.kiva.org/updates/kiva/2011/09/07/kiva-risk-ratings-now-with-half-stars.html.
 
VFC has been informed of our analysts’ findings and their corresponding change in rating.
 
About Vision Finance Company s.a – Rwanda

Established in 1999, Vision Finance Company (VFC) is an affiliate of World Vision International. Since its founding, VFC has been committed to alleviating poverty in Rwanda by ensuring that poor people have access to credit to support business initiatives that will improve their life circumstances.
Vision Finance Company’s mission is to promote economic empowerment and improve the standard of living of the Rwandan population through the provision of financial services to the working poor with an emphasis on women living in rural areas.

Our Lending Methodologies:

1. Community Banks

These loan circles create an opportunity for the poorest entrepreneurs to obtain credit. Self-selected groups of 10 - 30 borrowers agree to cross-guarantee each other’s loans. The group screens potential borrowers and tracks each repayment, building their leadership and sense of pride along the way. Loans typically range from US $ 20 - 394.
2. Solidarity Groups
Designed for more experienced entrepreneurs with larger enterprises, Solidarity Groups have fewer members than Community Banks, with an average of 5 members who guarantee each other’s loans. Members who make repayments on time become eligible for larger individual loans. Loan sizes range from US $175 - 890.
3. Individual Loans
Clients who have either grown their businesses successfully through a Solidarity Group or have medium-sized businesses qualify for individual loans ranging from US $890-7150. Loans typically require either two guarantors or collateral. Borrowers often create a multi-year business plan in consultation with their loan officer

Our Current Lending Products:
1. Urunana Product: poor clients, particularly women, without collateral or assets are targeted for access to credit. Group sizes vary from 3 – 20 or more.
2. Ubwizerane Product: experienced poor clientele are promoted to smaller groups and receive larger loan amounts.
3. Koramuhinzi Product*: agriculture loan product targeting individual rural farmers.
4.Inyongerabukungu Product*: targeted towards cooperatives of various sizes - primarily poor rural farmers.
5. Jyambere Product: entrepreneurs who possess collateral or presenting guarantors have access to loans.
6. Gubwaneza Product: low-level salaried people have access to loans through individual loan methodology based on standard credit processes.
7.Akarusho Product: also known as ‘asset-loan’ and ‘micro-leasing’, clients have opportunities to obtain/purchase equipments through loans.
8. Ngoboka Product: excellent clients have access to loans in the even of an emergency cash need situation.

* Vision Finance is among few financial institutions targeting farmers and providing agricultural credit options in Rwanda. This access to credit is critical for their ability to succeed and even exist as going concerns.

Our Savings Products:
1. Flexi Account: clients can save and make withdrawals many times as they want without penalties or fees.
2. Vosa Account: clients earn interest on their savings; withdrawal is once per week without penalties or fees.
3. FDA Account: this is fixed deposit account from 3 to 12 months, clients earn interest up to 7% per year.
4. Nyizera Product (Compulsory Savings): clients are required to save at least 10% to 20% of the amount borrowed in order to secure their loans.

Kiva HelpRepayment Performance on Kiva

    This Field Partner All Kiva Partners
  Start Date On Kiva May 24, 2008 Oct 12, 2005
Total Loans $2,884,000 $537,835,100
Amount of Raised Inactive Loans $0 $320,475
Number Of Raised Inactive Loans 0 249
Amount of Paying Back Loans $151,350 $109,850,425
Number Of Paying Back Loans 131 113,387
Amount of Ended Loans $2,732,650 $427,664,200
Number Of Ended Loans 2,809 549,502
Delinquency Rate 91.71% 3.39%
Amount In Arrears $31,883 $2,403,768
Outstanding Portfolio $34,765 $70,950,902
Number of Loans Delinquent 131 10,653
Default Rate 0.87% 1.01%
Amount of Ended Loans Defaulted $23,662 $4,334,868
Amount of Ended Loans $2,732,650 $427,664,200
Number Of Ended Loans Defaulted 68 14,050
Currency Exchange Loss Rate 0.00% 0.06%
Amount of Currency Exchange Loss $112 $298,028
Refund Rate 1.11% 0.82%
Amount of Refunded Loans $31,950 $4,417,000
Number Of Refunded Loans 28 4,864

Kiva HelpLoan Characteristics On Kiva

    This Field Partner All Kiva Partners
  Loans To Women Entrepreneurs 58.41% 74.09%
Average Loan Size $467 $417
Average Individual Loan Size $837 $656
Average Group Loan Size $1,557 $1,812
Average Number Of Entrepreneurs Per Group 6.5 8
Average GDP Per Capita (PPP) in Local Country $1,000 $3,463
Average Loan Size / GDP Per Capita (PPP) 46.66% 12.05%
Average Time To Fund A Loan 4.29 days 5.28 days
Average Dollars Raised Per Day Per Loan $108.66 $78.99
  Average Loan Term 8.13 months 10.05 months

Kiva HelpJournaling Performance on Kiva

    This Field Partner All Kiva Partners
  Total Journals 2,014 268,526
  Journaling Rate 61.49% 42.10%
  Average Number Of Comments Per Journal 0.08 0.09
  Average Number Of Recommendations Per Journal 1.04 2.06

Kiva HelpBorrowing Cost Comparison (based on 2011 data)

    This Field Partner Median for MFI Peers in Country All Kiva Partners
  Portfolio Yield 43.40% 39.80% 34.93%
  Profitability (Return on Assets) -0.1% -0.5% -1.11%
  Average Loan Size (% of Per Capita Income) 99.70% 73.40% 42.70%

Kiva HelpCountry Fast Facts

Field Partner Staff

Bright Batamuriza
Grace Dushimimana
Yacob Heliso Kuka
Solange Kamikazi
Rita Kobusinge
Fiona Luyiga
Robert Nuwamanya
Fiona Uwitonze