Last updated May 1, 2013

Partner Description:

Kubo.financiero is a regulated microfinance institution that provides accessible and affordable loans to borrowers in Mexico. Ranging from US$400 to $4,100, these loans can be used for working capital, fixed assets, education fees and supplies, and pre-payment for other loans that have higher interest rates.

Kubo operates in Mexico, which has one of the highest average interest rates in Latin America for two major reasons:

1) Banks and other lenders need to cover their administration and operation costs even though they provide very small loans. Incidentally, Mexico has one of the smallest average loan sizes and the deepest market penetration for microloans. The smaller the loan, the higher the interest needs to be to cover all the associated costs -- especially in remote regions where traveling to borrowers is expensive and time intensive.

2) Interest rates are also high because banks and other lenders are unable to take individual risk profiles into account. As a result, they must charge a higher interest rate across the board to cover risk of default -- sometimes as high as 120%.

While Kiva works with other lending partners in Mexico, we’re proud that they charge relatively lower interest rates between 55% and 85%.

User-added image

Kubo uses an online platform and branchless banking to significantly reduce the cost of lending. Because the microfinance market is Mexico is very large, the organization is able to access a growing amount of data about borrowers and their credit histories.

This enables it to provide borrowers with individualized interest rates of 22% to 50%, depending on a borrower’s risk profile. Interest is charged on declining principal, with no collateral required, and the organization charges a small 3% to 5% service fee to cover administration costs of small loans in remote areas.

By integrating technology and data, Kubo has positioned itself to support the more than 90% of Mexican businesses that qualify as small or micro-enterprises. And, with rapid internet penetration in Mexico, the organization has distinguished itself as an innovative lending platform in the region.

With funding from Kiva lenders, Kubo can expand its lending network even further, reach riskier clients who have less credit history, decrease interest rates for borrowers, and scale its service area.

Kubo.Financiero joined Kiva through our Experimental Partnership Program, and has therefore received a lighter level of due diligence. Accordingly, loans associated with this partner carry a higher level of risk than typical Kiva loans.

Image courtesy of Kubo.Financiero.

Repayment Performance on Kiva

    This Field Partner All Kiva Partners
  Start Date On Kiva May 2, 2013 Oct 12, 2005
Total Loans $299,150 $573,010,825
Amount of raised Inactive loans $400 $311,275
Number of raised Inactive loans 1 306
Amount of Paying Back Loans $194,800 $117,333,875
Number of Paying Back Loans 162 122,956
Amount of Ended Loans $103,950 $455,365,675
Number of Ended Loans 105 580,312
Delinquency Rate 0.21% 3.62%
Amount in Arrears $304 $2,773,489
Outstanding Portfolio $147,951 $76,542,883
Number of loanDelinquent 1 11,589
Default Rate 0.00% 1.08%
Amount of Ended Loans Defaulted $0 $4,927,943
Amount of Ended Loans $103,950 $455,365,675
Number of Ended Loans Defaulted 0 15,212
Currency Exchange Loss Rate 0.00% 0.07%
Amount of Currency Exchange Loss $1 $406,266
Refund Rate 0.00% 0.78%
Amount of Refunded Loans $0 $4,479,350
Number of Refunded Loans 0 5,008

Loan Characteristics On Kiva

    This Field Partner All Kiva Partners
  Loans to Women Borrowers 59.93% 74.23%
Average Loan Size $1,116 $418
Average Individual Loan Size $1,116 $656
Average Group Loan Size $0 $1,823
Average number of borrowers per group 0 8
Average GDP per capita (PPP) in local country $11,249 $3,442
Average Loan Size / GDP per capita (PPP) 9.92% 12.16%
Average Time to Fund a Loan 5.56 days 5.5 days
Average Dollars Raised Per Day Per Loan $200.65 $76.14
  Average Loan Term 10.12 months 10.24 months

Journaling Performance on Kiva

    This Field Partner All Kiva Partners
  Total Journals 19 286,081
  Journaling Rate 13.04% 42.44%
  Average Number of Comments Per Journal 0.00 0.08
  Average Number of Recommendations Per Journal 0.00 1.94

Borrowing Cost Comparison (based on 2012 data)

    This Field Partner Median for MFI's in Country All Kiva Partners
  Portfolio Yield N/A 74.00% 33.65%
  Profitability (return on assets) -9.1% 1% -1.29%
  Average Loan Size (% of per capita income) N/A 4.00% 41.84%

Country Fast Facts

Field Partner Staff

Abel Bezares
Vicente Fenoll
José Luis García
Edna Lara
Emmanuel Lopez
Estefania Martinez
Rogelio Monroy
Allan Seidman
Susana Valenzuela