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. 

Kiva's new risk rating system, which now includes half stars, has enabled us to display EDESA's risk rating with a higher level of granularity. As a result, EDESA's risk rating will now be displayed as 2.5 stars instead of 3 stars. 

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.

EDESA has been informed of the change in the display of their rating on Kiva's website.

EDESA provides the poorest rural communities in Costa Rica with financial services for the development of productive activities that allow individuals to move out of poverty.

EDESA’s focus is on rural communities without access to financial services, lending to microentrepreneurs living in poverty. EDESA believes that individual and communal empowerment is an effective way to combat poverty. As such, they work to equip rural entrepreneurs with the tools and opportunities within their own community to access financial services at the right time and with the right conditions. EDESA funds activities ranging from agriculture and cattle farming to tourism and retail to small restaurants and tailoring shops. Geographically, EDESA works in more than 100 rural communities in all regions of Costa Rica.

Established in 2005, EDESA provides credit services to a network of “Empresas de Crédito Comunal” or Community Credit Enterprises (CCEs), established by FINCA Costa Rica. The CCEs are small, grassroots community-owned financial organizations formed by rural community members. This unique methodology works to ensure that each family helped actively participates in the CCE in their community. By being participants and owners of these organizations, the beneficiaries also educate themselves on financial and business issues, as well as improving their self confidence by participating and being able to make decisions in a community organization. Youth also participate in the CCEs, thanks to an educational program where they learn how to invest, about issues of finance and business, and prepare to become the future entrepreneurs in their communities. Please click here to read more about the CCEs in general and here for an example of a particularly successful CCE, including video footage of the community and some microentrepreneurs.

EDESA firmly believes in economic development through the family nucleus. In each community EDESA works together with men, women, and children. As of March 2011, the rate of on-time repayment for EDESA's entire portfolio is 99%.

To see a video of EDESA and their work in Costa Rica, please click here.