Accessing loans in the country for small businesses, personal use or for paying school fees is a major problem for many people. Putting in mind the high interest rates that banks and micro finance institutions charge, loans are almost unaffordable.
Kiva is a non-profit organization founded in United States with a mission to connect people through lending to alleviate poverty. Leveraging the internet and a worldwide network of microfinance institutions, Kiva lets individuals lend as little as $25 (Ksh.2100) to help create opportunity around the world.
The organization currently partners with Faulu Kenya to give out loans and has partnered with Strathmore University to loan students short term and long term loans with very low interest rates. Some of the products for the education loans include;
10 year tuition loans
Long term loans target new students in full-time or part-time degree courses. Qualifying students will get a loan of up to Kshs 1,000,000 at the beginning of their first year of study to pay for their 4 year tuition fees.
Repayment commences one year after graduation, and should take 5 years. The interest payable for this loan will be at 2% for the first 5 years, and 4% thereafter. Even though the repayments officially commence in the 6th year, students/sponsor/guardians are encouraged to start making repayments earlier.
4 years max tuition loans
Short term loans target continuing students in the full-time or part-time degree students whose sponsors have cash flow challenges. Qualifying students will get a loan sufficient to cover their outstanding fees. The repayment period will depend on the degree program one is pursuing and the remaining period to graduation. The repayment is at 2% in the first year, 4% in the 2nd year and 6% thereafter.
Interest rates on these loans are subject to annual review but they do not affect prior loans taken.
Read more on KIVA.