This article does not proove Kiva's interest rates are higher than those stated, as we don't have Kiva's interest rates (for some reason), but they proove that actual APR interest rates are higher than the portfolio yield. This is ALWAYS the case, because portfolio yield does not incorporate some aspects of interest cost. It is not merely that these 10 banks demonstate this phenomenon, but EVERY bank has this, and it is generally worse in Africa where practices such as forced savings are more rampant. Also, you suggest that this might be okay because Kiva loans are lent at lower rates that the "regular" loans. How can we assume that? The banks are under no obligation to do that. The loans were made some months ago, from their regular loan portfolio, and then the Kivans come in and retrospectively buy this loan from the bank, in effect. What you are suggesting is that the bank gives out certain loans at a cheaper rate than its regular loans, and then hopes that the Kivans buy those specific loans from the bank. I find this extremely unlikely and have seen no evidence of this, either in the field or on the Kiva website.

But, perhaps we might not agree on this, but I am deeply worried about the use of the portfolio yield rather than stating an actual interest rates. In part this is because I think the poor are paying more than we are being told. Also I find this poor transparency, and Kivans are offering their money interest free, the least Kiva could do is be open with them. Other lending platforms are perfectly willing and able to do this. I also find this a worrying sign regarding Kiva's ability to control and monitor what is going on - if they can't even report an interest rate how good are the internal controls. They have had a number of "problems" with rogue banks - this doesn't surprise me given what I see of their controls. But most interestingly perhaps, this is perhaps a function of a flawed business model. It is not that I think Kiva CHOOSE not to publish these rates. I believe they simply CANNOT, and that is more worrying.

Kiva is, in some regards, similar to a retail bank (this is an analogy, not literal). It takes money from some people and lends it to others. Obviously there are major differences, but in essence these are the two key transactions - get money from A (you), lend to B (poor person) via agents (banks). It intermediates. And yet it doesn't know the interest rate in what is meant to be a P2P model? It can get you the photo and the story and some of the loan details like amount and number of months. Isn't this a little strange?

However, broadly I think we agree here - this is ultimately about transparency and reporting obligations, we disagree on the severity of the problem. But I would urge you to look into this further.

Another interesting comment is that you suggest change you personally would make - improved reporting, greater transparency, improved control, more accurate portfolio yield (by which you are referring to some proxy for interest rate) etc., good points. What is interesting is that there are other institutions already out there that have managed to overcome these problems, albeit to varying extents, and thus demonstrated that these are not deal-breakers, but relatively simple hurdles. Kiva has substantial funding and is heavily subsidized by volunteers, and yet can achieve none of this. And don't forget, it is not even as complicated as a bank. The most expensive stage of the chain is not collecting money from US citizens via PayPal and a website, nor sending money over to the banks in other countries, but doing the actual loans to the poor people in the field, and Kiva doesn't do this final stage, so has no actual costs of due diligence of clients, visiting their businesses, completing the forms, paying the loan officers, collecting repayment and dealing with non-repaying clients. It is only dealing with the relatively simpler and less onerous parts of the chain of money from your pocket to the pocket of the end client, and yet cannot even do this well.