Prosocial Crowdlending in Kenya

The crowdfunding industry has emerged in the past few years as one of the most promising alternative financing options. Lending and donating operations accounted for 81% of the crowdfunding industry's $34.4 billion total funding volume in 2015. Kiva Zip, a prosocial program, created an online platform that provides 0% interest peer-to-peer loans and has features in common with lending and donating crowdfunding platforms. This program is a spin-off of Kiva.org. Although both platforms have a similar objective and modus operandi, they differ primarily because Kiva.org has a figure called a field partner, who is the intermediary between borrowers and lenders, while Kiva Zip has no field partners but does have so-called trustees, who provide support to borrowers but do not act as intermediaries for resources or charge for their services. The authors thoroughly analyzed Kiva Zip's operations in Kenya for the years from 2011 to 2015. Kiva Zip has stopped posting new campaigns in Kenya but has continued to collect payment for previously delivered loans. We studied in detail the impact that lenders, borrowers and trustees had on the platform's performance. In addition, we analyzed the different stages of a campaign on Kiva Zip: when a campaign is posted, when it is funded and when the loan is paid back. This analysis may provide insight into the levers that drove the performance of Kiva Zip in Kenya, which in turn could have enabled the organization to identify areas for improvement in order to continue operating in the country. In addition, we have identified relevant theoretical frameworks for analyzing prosocial crowdlending in greater depth.