Kiva: Dreams Funded

Dreams Are Universal - Opportunity Is Not

 We celebrate and support Palestinians looking to create a better future for themselves, their families and their communities. Palestinians looking to secure traditional loans and funding are often met with road blocks. We seek to economically empower Palestinians by crowdfunding Kiva loans that will enable people to achieve their ambitions, education and projects, which could directly improve households’ income and help integrate Palestinians into the labor market. FOPN seeks to improve Palestinian lives through safe, fair access to credit; we invest a portion of all book proceeds to support Palestinians through KIVA Crowdfunding.  

What Is Kiva?

  Kiva is an international nonprofit, founded in 2005 and based in San Francisco, with a mission to connect people through lending to alleviate poverty. Kiva celebrates and supports people looking to create a better future for themselves, their families and their communities. 

 By lending as little as $25 on Kiva, anyone can help a borrower start or grow a business, go to school, access clean energy or realize their potential. For some, it’s a matter of survival, for others it’s the fuel for a life-long ambition.100% of every dollar you lend on Kiva goes to funding loans. Kiva covers costs primarily through optional donations, as well as through support from grants and sponsors. 

It's a Loan, not a Donation

 We believe lending alongside thousands of others is one of the most powerful and sustainable ways to create economic and social good. Lending on Kiva creates a partnership of mutual dignity and makes it easy to touch more lives with the same dollar. Fund a loan, get repaid, fund another. 

Loans to Palestinians

 When we loan to those in the Palestinian community, Kiva creates the opportunity to play a special part in someone else's story. At Kiva, loans aren’t just about money—they’re a way to create connection and relationships. That loan enables someone to grow a business and create opportunity for themselves, it creates opportunities for others as well. That ripple effect can shape the future for a family or an entire community. 

 As a Kiva lender, we support small Palestinian business owners and those seeking to improve their lives through education. 

Islamic Microfinance

 Kiva lends to thousands of entrepreneurs in countries where Islamic law impacts how people can borrow money and pay it back. Below, learn how Kiva's Field Partners approach these loans, which will be identified in loan descriptions going forward.

How is Islamic microfinance different?

 Islamic banking was created as a separate path of financing in order to comply with prohibitions stipulated by Islamic law. Also referred to as Sharia law, Islamic law can be considered God's law as interpreted by Muslims. 

 Islamic scholars called Muftis in the Sunni tradition and Mullahs in the Shia tradition are charged with interpreting this law. The central texts of Sharia law are the holy book of the Qur'an, and the examples set forth by Muhammad and his early followers are documented in a collection of texts called the Hadith. To render a legal opinion, scholars weigh an action or principle against these texts and determine if it is in accordance with the spirit of the law. 

 Sharia law is very clear about charging interest on loans. The Qur'an forbids usury, or riba, in four different revelations based on the belief that money is only a medium of exchange and has no value in itself. Islam has not relented to pressures from the marketplace and has maintained its stance that charging interest on loans is usurious and a violation of Islamic law. 

 However, by differentiating trade from usury, the Qur'an reaffirms the practice of trading as a respectable profession. The importance of trading partnerships has motivated financial intermediaries to find creative ways to help Muslims access loans without violating Islamic law. 

 Some of Kiva's Field Partners that serve Muslim borrowers have created loan products based on Islamic principles to better serve their clients. These products have 0% interest and vary in design and delivery mechanisms. While some charge a service fee to cover the costs of administering loans, others share risk between lenders and borrowers or lease assets to borrowers (see next section for more details). 

 To certify that these products are compatible with Islamic principles, it is important for a microfinance institution to receive a fatwa, a legal pronouncement made by an Islamic scholar or religious leader, that officially condones its work. 

Why does Kiva support Islamic microfinance?

 The prohibitions against usury in the Qur'an are designed to protect weaker individuals from exploitation. Islamic microfinance attempts to capture the spirit of Sharia law by allowing financial tools that create and maintain a just economic system -- one that protects clients through built-in mechanisms like risk sharing. 

 Kiva believes in supporting products that are culturally compatible and designed to protect borrowers. 

What Islamic loan products appear on Kiva?

 Kiva Field Partners post the following loan products to serve Muslim clients (adapted from traditional Islamic financial principles): 

 1) Qard Hassan: Interest free loans, usually to students or the very poor.

2) Murabaha: Purchasing goods for borrowers and charging a fee* or mark-up.

3) Musawama: The seller and buyer arrive at an agreed price for a commodity.

4) Mudaraba: A limited liability partnership (not allowing for direct investor involvement).

5) Musharaka: A joint venture with profit and loss sharing.

6) Salam: An advance purchase of goods delivered on a future date set by the buyer and seller.

7) Ijarah: Leasing of goods with a second contract to purchase them at the end of a lease period.

8) Joala: Payment of upfront fees.* 

 *How much are the fees associated with Islamic loans? 

 The fees associated with Islamic loans vary from one microfinance institution to another. As with all loans on the Kiva site, the best measure of fees paid by a borrower is the Portfolio Yield, displayed on borrower profile pages as well as Field Partner profile pages. 

How is paying a fee on a loan different than paying interest?

 For many Muslim borrowers, paying a fee on a loan is like paying a service fee on any other service transaction. Borrowers are purchasing the service of being provided with money. They pay a fee in the same way they would pay for consulting or advisory services. 

 When a borrower is about to receive a loan, he or she pays a fee to the microfinance institution before receiving the funds. In contrast, interest paid during the course of a loan is seen as money earned by the microfinance institution on the money itself, rather than a fee for the service.

 Have questions about Islamic lending? Send them to: