Microlending Platform Kiva Receives Support from City

A recent string of investments and endorsements is putting Columbus that much closer to earning its official designation as a Kiva City.

Since July of 2015, Reese Neader has been bringing a local presence to the microlending site based in San Francisco. Neader’s job has been to build awareness around the resource, rally community supporters and raise the necessary funds to make Kiva a permanent fixture in the resource arsenal for local small business.

To become an official Kiva City, Columbus must receive an endorsement from the city, onboard community partners and funders, and raise $225,000 to fund future fellowships, build the Kiva Columbus website and support the official launch event. Neader is close to checking all those boxes.

During his first state of the city address, new Mayor Andrew Ginther expressed his support for the platform calling it an opportunity for local businesses to thrive.

“Having the city backing this now in an official capacity is fantastic because it carriers a whole new weight to the program, and that’s supposed to be the idea,” Neader says. 

He also notes that Councilmembers Shannon Hardin and Liz Brown were instrumental in championing the city’s official endorsement and fundraising efforts.

“The City of Columbus, we’re really proud to support Kiva in our community,” Brown says.

Columbus is one of only about a dozen cities across the country with a Kiva program.

“We are so lucky to bring Kiva into Columbus,” Hardin says. “What we are really excited about is a lot of the loans, a lot of the small businesses are minority-owned, female-owned. That’s a huge win for us.”

Hardin shares that Kiva’s ability to help businesses grow, expand and create jobs in the community influenced the city to put its weight behind the platform.

Kiva supporters gather at Rambling House

Community institutions like The Columbus Foundation, GCAC, United Way of Central Ohio and the Ohio Capital Corporation for Housing have committed funds to help Kiva meet its goal, as well as Louisville-based Access Ventures. Neader says he is nearly to $225,000 and expects to hit the mark by the end of the month.

“We’re currently in conversation with several financial institutions to be the banking partner with us which would create a $150,000 matching revolving loan fund,” Neader adds. 

That fund would provide a dollar for dollar match that would allow borrowers to hit the halfway mark and be funded, replenishing the loan fund as they pay back.

Looking at the platform’s intended purpose – get capital in the hands of business owners that need it – Kiva has also made its mark in Columbus over the last nine months.

“To date we have fully-funded 16 loans for $67,000,” Neader says. “Over half of those loans have gone to minority business owners, [and] five of those loans have gone to social enterprises.” 

Another 20 loans that are in the review process could equate to another $100,000 in the hands of small business owners.

Many of the loans have been disbursed to businesses under scalable retail, arts and culture, fashion and food and beverage. Neader says many of them are community-centered as well, caring about giving back and being a broader part of the community. Many loans have gone to brick-and-mortar funds for businesses to open in neighborhoods that need them.

Community plays a huge role in the Kiva platform all around, as is evident by the influx of trustee partners Neader has brought on over the last year, and the lending network that is funding loans in as little time as one day

Working on a social underwriting model, a business must be endorsed by a trustee organization to begin fundraising. Along with publicly vouching for that business, a trustee leverages their personal network to help with the initial funding push. The network of Columbus trustees has expanded to over 10 for- and non-profit businesses including the Columbus Idea Foundry, North Market, Starfish Alliance, Central Ohio SBDC, Small Business Beanstalk, SunDown RunDown and Geben Communication.

“It’s finding the community partners that really understand the product and are proactive about using it,” Neader says. “It’s been great to see examples of community trustees really stepping up and engaging to support their borrower.” 

Marshall Shorts shares his experience with Kiva

Borrowers, trustees and their networks have combined to accomplish goals like funding Bake Me Happy’s $2,000 loan in just 24 hours. Other successful borrowers like Marshall Shorts of Soulo Theory Creative and Rambling House Soda Pop are finding ways to pay it forward.

“The great thing is these borrowers then become trustees,” Neader says. 

Last night borrower Rambling House hosted a Kiva Meetup to bring supporters, trustees and borrowers together.

“Every event that we host is supposed to be an educational event not just for borrowers but for lenders,” Neader says. 

Momentum and word of mouth have served as eduction tools so far, but Neader hopes that when the city receives its official designation, likely sometime in May, it will elevate the focus and knowledge of the platform.

For more information, visit zip.kiva.org.

Photos via Access Ventures.