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June 7, 2011

4

Ranking Kiva’s Partners – The Need Factor

by brainoids

Earlier this month I posted an analysis of which countries most need Kiva.org’s microfinance services (based on their poverty rates) and which countries are getting them (based on Kiva’s actual lending data).   This analysis provides an opportunity to update my ranking of Kiva in-country microfinance banking institutions from last fall, to include “relative need”.November’s ranking derived from three factors: an MFI’s interest charging practices, its cumulative experience, and its risk level.   The ranking simply composited these factors.  A downside of this approach is that some of the neediest countries – e.g., many if Africa – by their nature may cause MFI’s to score poorly in the rankings.   (For example, poor infrastructure such as roads, etc., will drive up the interest rates MFI’s must charge, to cover the transactional costs of the loans.)

Including the “need factor” based on poverty rates and Kiva penetration helps offset this bias, and helps identify those MFI’s that may be “worth taking a chance on” in high-need, but higher-risk, countries.   Below is a revised regional ranking, in which I have also filtered out about a third of the MFIs with extremely low scores in any of the four metrics:

Kiva MFI partner rankings. Sub-factors include Interest Practices (green), Risk (yellow), Experience (blue), and Relative Need (red).

To simplify things, I’ve also recreated a “top 20 table” from the overall rankings.   In this table, any MFI with a score in the lower third of any of the four sub-factors has been filtered out.   In short, this table provides a way to pick Kiva loans such that your loan dollars go to the neediest regions of the world, while balancing your financial risk and rewarding institutions that keep their interest rates within (or better than) the norm for microloans.

The Top Twenty

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4 Comments Post a comment
  1. Sep 28 2012

    Dennis – Very grateful for this data you’ve provided because I’m about to make my first Kiva loan and because I’m a bit wonk-ish. 🙂

    Reply
    • Dec 16 2012

      Monica – awesome, welcome to Kiva and thanks for the kudos! I wouldn’t know ANYTHING about being wonk-ish!!!

      🙂

      Cheers,

      Dennis

      Reply
  2. Dec 13 2012

    I found this analysis very interesting and useful. But I was wondering how did you get the information? I am interested in scraping my own information based on my own preference, so any suggestions would be great.

    Best,
    BZ

    Reply
    • Dec 16 2012

      Hi Ben – thanks! Most of the data I manually gathered partner by partner from Kiva’s pages. The format seems to have changed from when I did the original analysis, but the master list is at: http://www.kiva.org/partners . Not really set up for automated scraping, but there are deeper data at each of the partner links.

      Very interesting to scroll down the list and see the number of MFIs that have closed (or had their relations with Kiva) closed – I guess underscores the volatility and difficulty of the enterprise.

      Good luck, and if you pull something together, please let me know!

      Cheers,

      Dennis

      Reply

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