Changes to endorsement requirement and loan size progression

Discussion in 'Announcements' started by Julia Kurnia, Nov 24, 2013.

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  1. Denise

    Denise Gold Member

    Julia, there is a mistake on the "borrow" page on the main site:
    If this is your first loan through Zidisha, you can borrow up to USD 50 (one hundred US Dollars). Each time you repay a loan on time while maintaining a 95% repayment rate for all monthly installments, your credit limit will increase.
    It should say ("fifty US dollars").
     
    Shehi likes this.
  2. qt9998

    qt9998 Gold Member

    I also concur with AHTS about the $50. When the limit was changed to $100, I cut my bids to $25. So now I should
    cut them to $10? It reminds me of when I was a kid and my uncles would give me a dime.
    If I just continue to lend $25, MY risk doesn't really change as AHTS explained, but then just two of us can fund a loan.
    Soon Zidisha will be like Kiva's Zip program where you can't even find a loan in Kenya.

    Anyway, time will tell. The combination of fewer applicants and easier funding may dry up the pool of applicants
    to the point where all the loan applications will be for 2nd, 3rd loans and we are no longer supporting new entrepreneurs.
    Or new applicants will pay off the $50 with the same $50 over a period of one month, then apply for $150, etc. which will
    essentially defeat the purpose of the initial loan which was supposedly to establish credit.
     
  3. Julia Kurnia

    Julia Kurnia Director, Zidisha Zidisha Staff

    Denise, thanks for catching that! It is now corrected.
     
  4. Julia Kurnia

    Julia Kurnia Director, Zidisha Zidisha Staff

    qt9998, thanks for this advice. We are exploring ways to safely offer larger loans, in addition to the approach of allowing newcomers to establish track records with small initial amounts. One option we are offering now is to allow members who have been invited by existing members with positive on-time repayment track records to start with $250 instead of $50. (You may view the recent announcement about this here.) I'd welcome ideas for other ways we might allow new members to earn more substantial loan sizes without exposing our lenders to too much credit risk.
     
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