Jorge Antonio’s story
Jorge is an experienced carpenter who, many years ago, learned this trade thanks to the experience gotten from working in many wood shops. He asks for a loan to purchase wood, fabric, and paint which allow him to make more coffins. His principal dream is focused on his son, since he wants to give him a very good education.
He is always thinking of Interactuar as his ally and partner in his productive process.
If you want to know more about the entrepreneurs and the loans from Interactuar, you can join the Lending Team called: “Friends of Interactuar Colombia”: http://www.kiva.org/team/interactuar_colombia
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More about this loan
By funding this loan, you’re promoting entrepreneurship in remote regions of Colombia, including areas recovering from guerilla warfare, and helping to reverse the rural exodus which occurred in the past decades when the rural population fled their countryside homes for safety in cities.
This loan product was created by Kiva’s Field Partner, Interactuar, specifically for Kiva funding, in an effort to reach more borrowers in rural areas. While much of Interactuar’s lending operations are focused in urban parts of Medellin, this loan product is designed to provide working capital for riskier businesses operating in rural areas that have been traditionally excluded from the financial sector.
This loan is structured on Kiva as a bullet loan, which means a single payment is required at the end of the loan term. By Colombian law, Kiva’s partner Interactuar is required to offer borrowers loans with a variable interest rate that fluctuates with the market rate. Because fixed monthly payments are applied first to interest and then to principal, Interactuar is unable to predict upfront what portion of each repayment would go towards the loan principal. This creates a challenge with Kiva’s system, which doesn’t allow for unpredictable principal payments, and can result in some Interactuar clients appearing falsely delinquent. To remedy this, the loan has an end-of-term repayment plan on Kiva, but the borrower will continue scheduled monthly repayments to Interactuar, who will then pass along the principal amount to Kiva lenders. This means that you may see repayments made on this loan throughout the repayment term, as opposed to receiving repayment in full at the end of the loan term.