Here at the SMS Kiva club, we love to help people in need. We also want to make sure the loans that we make are safe, and reliable. This is why we did not make a loan to a young woman the country of Columbia named Scarlet*.

The first thing that caught my eye was that she was trying to get money to pay for a higher education. I read her story, and learned that she wanted to study clinical psychology. But after I read her story, I started to look at the numbers. That’s  where things got hairy.

The delinquency rate and the amount of late payments is zero, which is great because that means we don’t have to worry about getting our money back late. The loans at risk rate is also zero, so that means we are 100% guaranteed to not lose our money. The default rate is also zero, which is another good sign.

At this point you are probably wondering how this loan is bad. You’re wondering when we’re going to get to the part about how this is NOT a good loan.

Well, this is that part. After I looked at the delinquency, default, and loans at risk rates, I looked at the method of how Scarlet was going to pay us back. She was going to pay us back irregularly, which means we don’t know when we are going to get our money back. We do know when we will get our final payment at the latest. We would get our money back, at the latest, 130 months from now. That means we would get all of our loan back 10 YEARS from now.

Overall, we would not make this loan. We like to get our money back as soon as possible so that we can make a difference in more people’s lives.

#kivabecausewecare

By Evan C.

 *Blogger’s Note:  We wanted to link to Scarlet’s profile here so you could check our facts, but by the time that we got our post written, her loan was funded and we couldn’t find her again!