Fundraising Status:active
Risk Rating:
What to know about this Lending Partner
Impact Category:
General Financial Inclusion
Default Rate:
1.51%
Currency Exchange Loss Rate:
1.17%
Total Loans Raised:
$8,498,970
Loans at Risk Rate:
6.78%
Kiva Borrowers:
6,665
Delinquency Rate:
4.89%
Interests and Fees:
41% PY
Kiva conducts regular, ongoing monitoring of all Lending Partners, but only posts status updates here in response to relevant, major changes at the partner.
Partner description:
VisionFund Rwanda (VFR), formerly known as Vision Finance Company, is the microfinance subsidiary of World Vision and is one of the largest microfinance institutions serving rural underprivileged communities in Rwanda, many of which do not have access to formal financial services. VFR started in 1997 as a microfinance department under World Vision Rwanda and has since grown to become one of the largest regulated microfinance institutions in Rwanda today.
VFR serves people and communities that are economically productive but low-income, especially in very rural areas. This includes small business owners and salary earners who are looking for opportunities to provide better lives for their families and a promising future for their children.
The average client of VFR is a woman, often widowed, looking after a family of 5-7, some of whom are orphans. She owns a small business, usually a market stall in a market or a roadside kiosk. She believes she can grow her business to support her family, sending her children to school and to providing for their health and welfare.
A unique lending approach:
VFR services communities with 3 main types of loans: community banks, solidarity groups and individual loans. Community banks create an opportunity for the poorest entrepreneurs to obtain credit. These are self-selected groups of 10 - 30 borrowers who 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.
Solidarity groups are designed for more experienced entrepreneurs with slightly larger enterprises. They 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.
Individual loans go to borrowers who have either grown their businesses successfully through a solidarity group or who have medium-sized businesses that qualify for these larger loans. The individual loans typically require either 2 guarantors or collateral. Borrowers often create a multi-year business plan in consultation with their loan officer.