When Data Sees Potential: How Kiva Is Powering Financial Inclusion Through Cash Flow Intelligence

About Kiva

Kiva is a U.S. based nonprofit that expands financial access to underserved communities through small loans for entrepreneurs and small business owners. By connecting individual lenders to borrowers through crowdfunding, Kiva helps local business owners grow their livelihoods, create jobs, and strengthen their communities.

Challenge

Kiva’s mission is to make capital accessible to those excluded from traditional finance. Yet even with that purpose, Kiva faced a delicate balance: managing high arrears while still reaching entrepreneurs who deserved a chance.

Conventional credit approaches struggled to read the financial reality of many small business owners, people with irregular income patterns, limited histories, or seasonal cash flow cycles. As a result, Kiva risked both under-lending to capable borrowers and over-exposing its portfolio to defaults.

The challenge wasn’t just about risk accuracy, it was about rebalancing risk and impact. Kiva needed a more dynamic, data-driven way to assess borrower credit worthiness and financial health, one that could empower inclusion without compromising responsibility.

Results at a Glance

• ‍Carrington Labs Credit Risk Model provided a Kiva-specific risk score to identify risk with greater accuracy and reveal new opportunities to lend responsibly.
• Early Arrears down 20% year-on-year in Q1 2025 and more than 50% in Q2 2025, showing consistent improvement in loan performance and repayment quality.
• Improved loan quality, with fewer borrowers entering delinquency in the first repayment cycle.
• More inclusive lending, as data-driven insights enabled Kiva to expand access to credit responsibly.

Solution

Carrington Labs Product: Credit Risk Model

Kiva turned to Carrington Labs to bring deeper intelligence into its domestic underwriting process. With the Carrington Labs Credit Risk Model, Kiva could evaluate borrowers based on the combination of disparate data points rather than static rule-based approvals.

The model was created utilizing Carrington Labs’ unique technology, which enables auto model builds, custom to each lender. The approach results in the ability to more accurately assess borrower expected performance by:

• Analyzing financial and behavioral data to reveal income stability and expense trends.
• Identifying repayment capacity through dynamic, time-based analysis.
• Assessing borrowers for probability of default.
• Returning a Kiva-specific risk score directly to Kiva’s Salesforce Sales Cloud, integrating seamlessly with existing systems.

Unlike legacy approaches to credit risk scoring, Carrington Labs’ approach translates raw f inancial and behavioral data into meaningful insight, uncovering patterns that reveal both resilience and risk. For Kiva, that meant seeing each borrower in a new light; it meant recognizing potential where others saw uncertainty.

Every insight became a story: the aspiring entrepreneur able to set up their cleaning business, an artist being able to scale their sustainable jewelry business, a local baker being able to serve more of the community by investing in new equipment. Through Carrington Labs’ technology, Kiva could serve them responsibly with precision, confidence, and empathy.

Outcomes

Carrington Labs measures portfolio health through early arrears - the percentage of loan balances more than 30 days past due after the first repayment date.

Since implementation, Kiva has achieved sustained improvement in loan quality and repayment reliability:

• Q1 2025 - Early Arrears down 20% from Q1 2024.
• Q2 2025 - Early Arrears down 68% from Q2 2023; down 58% from Q2 2024.

A lower early arrears rate reflects stronger underwriting and more accurate borrower evaluation. For borrowers, it means greater access to fair, affordable credit. For lenders, it means more reliable repayments fuelling Kiva’s cycle of reinvestment and multiplying future impact.

This partnership demonstrates how innovation can drive both purpose and performance. Carrington Labs helped Kiva rebalance risk and impact, proving that financial inclusion and portfolio strength can grow together.

“Working with Carrington Labs allowed us to improve loan performance in a way that aligns with our mission while simultaneously equipping us with a system we can use to scale. Their credit risk modeling capabilities have helped us continue efficiently serving entrepreneurs and small businesses who might otherwise be overlooked, while ensuring we build a stronger, more sustainable lending portfolio."
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Eli Cherner
Director, Kiva US

Carrington Labs’ credit risk analytics help organizations strengthen portfolio quality, improve repayment performance, and responsibly expand financial inclusion.

Together, we can turn data into confidence and confidence into opportunity. Book a demo to see how Carrington Labs can help you rebalance risk and impact.