Kiva conducts regular, ongoing monitoring of all Lending Partners, but only posts status updates here in response to relevant, major changes at the partner.

Status update — December 20, 2017

Kiva and Evidence Action have agreed to end their partnership and default the remaining loans, due to severe challenges in the carbon credit market, which have impacted repayment potential. Kiva will settle out the $50,000 received to lenders pro-rata and move forward with closing this partnership.

Evidence Action was Kiva’s first partner focused on providing safe drinking water using chlorine dispenser for purification at the community level. Since 2013, Kiva lenders have enabled 256,889 people in rural Kenya to get access to safe water via 2,111 dispensers through Evidence Action’s Dispensers for Safe Water program. Kiva and Evidence Action piloted an experimental loan repayment model whereby when households use chlorine dispensers, instead of boiling water using firewood that emits greenhouses gases, they generate carbon credits which can be sold on the carbon credit market.

While the program has been a resounding success from an impact and execution perspective, the carbon credit revenue model has not been successful for loan repayment. Two major changes occurred in the carbon market, and as a result, Evidence Action will no longer generate enough revenues from carbon to cover their operating costs or financing costs from Kiva. The first change was a sharp decline in price within the compliance market for carbon, which forced Evidence Action (and much of the broader market) to move to the voluntary market, where prices similarly declined, given the oversupply of projects for buyers to choose from. The second shock was a series of changes to the implementation of the methodology that the Clean Development Mechanism (CDM) of the United Nations Framework Convention on Climate Change (UNFCCC) mandates for registration and issuance of carbon credits. While Evidence Action designed their monitoring mechanisms to comply with UNFCCC standards, the regulator outlined additional sampling requirements that were not clearly mandated during the registration process, which reduced the total number of credits that were issued. While they were quick to adjust their sampling methodology to comply with these new requirements, it has significantly eroded their future projections for carbon revenues.

Despite these challenges, Kiva still believes there are opportunities to help meet credit needs for water purification technology in the future, and we are using the lessons from our work with Evidence Action to impact future partnership decisions in this space. We thank Evidence Action for their partnership over the past 5 years and wish them success in their future endeavors.

Partner Description:

There is a gap between what research shows is effective in development and what happens in practice on the ground. Evidence Action is a nonprofit organization that scales proven development interventions and crafts resilient business models for long-term success.

Evidence Action only scales solutions whose efficacy is backed by rigorous evidence. To maximize impact, it targets cost-effective interventions that can potentially improve the lives of millions. In the process, Evidence Action identifies innovative and appropriate financing mechanisms and constantly works to improve its operations. To maintain high standards, Evidence Action self-evaluates, learns, and improves its models with a commitment to increasing transparency, impact and value for money.

One of Evidence Action’s flagship programs is Dispensers for Safe Water. This is an entrepreneurial program to make chlorine dispensers available to more people. Chlorine dispensers are a proven innovation that dramatically expands access to clean water for less than 50 cents per person per year at scale.

This solution was developed by testing several ideas to address the problem of diarrheal disease, a leading cause of death for children under five in Kenya. Researchers at Harvard University and the University of California, Berkeley -- in collaboration with Innovations for Poverty Action -- identified chlorine dispensers as the most effective, low-cost intervention.

Chlorination is a well-known means of treating water that is unconsciously appreciated by millions of people in developed countries every day. Chlorine dispensers placed at water access points like wells, springs, and boreholes enable communities to access chlorine when they collect drinking water. These users simply need to turn a valve on the dispenser to release a metered dose of chlorine into their water containers (usually standard yellow jerricans), and then collect water as usual. The chlorine disinfects the water and protects against recontamination.

Rigorous evidence supports chlorine dispensers. Academic studies found that fewer than 1 in 6 households chlorinated their water when they didn't have access to a dispenser, but more than half of households treated their water when there was one available. Building on the great success of this research, the Dispensers for Safe Water program has been incubated at Innovations for Poverty Action and is now being scaled up at Evidence Action.

This year, Evidence Action will provide over 1 million people in Africa with access to safe water with the help of Kiva loans and the sale of carbon credits. Kiva loans will enable Evidence Action to install and maintain 3,000 dispensers in rural villages in Kenya that have high rates of water-borne disease. These dispensers will provide approximately 600,000 people with access to safe water; preventing an estimated 750,000 episodes of diarrhea, and saving more than 700 lives.

As shown in the diagram below, loans made through this partnership are disbursed in-kind to communities. These communities are represented on the Kiva website by local “promoters,” volunteers who are effective ambassadors for the dispensers.

When households use chlorine dispensers, they generate carbon credits because chlorination enables people to drink safe water without having to boil it. The burning of wood during boiling releases harmful greenhouse gases into the atmosphere. This valuable behavior change is monetized through the sale of carbon credits on the voluntary carbon market. Revenue earned from the sale of the credits will be used to maintain dispensers and repay Kiva lenders.

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Repayment Performance on Kiva

    This Lending Partner All Kiva Partners
  Start Date On Kiva Sep 9, 2013 Oct 12, 2005
Total Loans $799,950 $1,958,454,115
Amount of raised Inactive loans $0 $196,930
Number of raised Inactive loans 0 171
Amount of Paying Back Loans $0 $161,031,645
Number of Paying Back Loans 0 188,514
Amount of Ended Loans $799,950 $1,768,236,180
Number of Ended Loans 519 2,370,020
Delinquency Rate 0.00% 12.22%
Amount in Arrears $0 $12,205,675
Outstanding Portfolio $0 $99,884,553
Number of Loans Delinquent 0 72,810
Default Rate 93.75% 1.83%
Amount of Ended Loans Defaulted $749,950 $32,298,216
Number of Ended Loans Defaulted 519 84,743
Currency Exchange Loss Rate 0.00% 0.50%
Amount of Currency Exchange Loss $0 $11,931,838
Refund Rate 0.00% 0.54%
Amount of Refunded Loans $0 $10,526,300
Number of Refunded Loans 0 9,596

Loan Characteristics On Kiva

    This Lending Partner All Kiva Partners
  Loans to Women Borrowers 63.95% 78.22%
Average Loan Size $379 $392
Average Individual Loan Size $0 $589
Average Group Loan Size $1,541 $1,891
Average number of borrowers per group 4.1 8.3
Average GDP per capita (PPP) in local country $1,800 $5,599
Average Loan Size / GDP per capita (PPP) 21.04% 7.00%
Average Time to Fund a Loan 5.26 days 8.93 days
Average Dollars Raised Per Day Per Loan $71.97 $43.87
  Average Loan Term 71.11 months 11.47 months

Journaling Performance on Kiva

    This Lending Partner All Kiva Partners
  Total Journals 0 1,178,576
  Journaling Rate 0.00% 42.26%
  Average Number of Comments Per Journal 0.00 0.02
  Average Number of Recommendations Per Journal 0.00 0.57

Borrowing Cost Comparison (based on 2015 data)

    This Lending Partner Median for MFI's in Country All Kiva Partners
  Average Cost to Borrower 0% APR 36.00% PY 27.02% PY
  Profitability (return on assets) -44.7% 0.5% -3.10%
  Average Loan Size (% of per capita income) N/A 56.00% 0.00%

Country Fast Facts

Lending Partner Staff

Alexandra Cosman