1.) What is FITE?
FITE is a new global empowerment platform, designed to foster financial independence for women through entrepreneurship (FITE). FITE will focus on strengthening women’s access to microfinance capital, providing small loans that can help them start a business or grow an existing business.
2.) Why focus on women?
There are a number of reasons why the FITE program is focused on women entrepreneurs.
We agree with thought leaders like the World Bank and Kofi Annan, that women are tremendous, untapped investments that yield huge returns for entire communities. When a woman develops her own sustainable business, not only does she improve her own situation – but her entire community benefits through a multiplier effect of change.
And yet, investments in women are not yet being made. Women are traditionally more likely to be denied a loan by a bank and often face high levels of financial discrimination. More than 70% of people who live below the poverty line are women.
We see tremendous potential to make a significant impact by filling this gap between what women can do and what women need.
3.) What does FITE do for men?
Economic growth and development are key to solving community-wide issues like poverty, disease, access to clean drinking water, and population growth. When women have a sustainable trade, they can provide food and shelter for their families, as well as jobs for other men and women, truly stimulating the local economy. By investing in FITE, you are investing in women, men, and whole communities.
4.) How does it work?
To direct a small loan to the entrepreneurial project of your choice, consumers simply buy a FITE-marked product, visit the website, and choose the type of business and part of the world they wish tosupport. The FITE partner offering that product will direct a $1 donation towards a microloan that matches those criteria, and provide an update oncethat microloan is funded. Microloans will typically be funded on a bimonthly basis.
5.) Why 25,000 women?
As the founding partner for FITE, Dermalogica has helped more than 25,000 skin therapist entrepreneurs start and grow their businesses with a unique marriage of innovative products, results-oriented treatments, an industry-renowned education network and unsurpassed business support. Dermalogica has seen firsthand the transformative power that entrepreneurship has had on these women’s lives, and on their communities. So, as a celebration of this, Dermalogica will work together with its Tribe around the world to help 25,000 women start or grow their own small businesses by giving them a “hand-up” through a microloan. We hope our other FITE partners will follow similar commitments, and join FITE with us!
6.) Why can’t I select the exact woman I want to donate to with my FITE code?
Kiva funds microloans in $25.00 increments, inorder to keep their infrastructure efficient and their process streamlined. To facilitate our program, we will consolidate redemptions into $25.00 loan increments, and then apply that money towards a microloan that reflects theoptions that you have selected during the redemption process.
As an example, if you have selected the business type “grocery stores” in region “Africa” we will direct your designation — and that of everyone else who has made the same selection — to a women entrepreneur wishing to grow or start her grocery store business in Africa. This way, weoffer you the ability to direct your funds, while keeping Kiva’s mechanism efficient.
Once we have funded the loan, we will send you(and your fellow FITErs) an email, introducing the recipient and her business.
You can also opt to donate $25.00 via credit card, in which case you can fund a full loan segment, and thus select the specific entrepreneur of your choosing. Fund a loan now!
7.) Why must I go online to redeem my FITE code?
An integral part of the FITE program is allowing consumers to choose where we direct our philanthropic donations, and thus make it easy for people to connect and make a difference in this important cause. We want to know what matters to you, and so are rewarding consumers who wish to learn more and join the FITE online with a donation towards an entrepreneurial project of their choosing. Over and above that, Dermalogica is also contributing towards an education campaign, lead by Kiva, to help raise awareness of this important cause so that we can get consumers around the world to join FITE.
8.) How much of the $1.00 from my code redemption goes to fund a microloan, versus to overhead or administration costs?
The full $1.00 amount is applied to the microloan, with no funds taken for fees, administration or handling. When the loan is repaid in full, it will be re-loaned at full value — meaning that the funds will continue to help entrepreneurs around the world for many years to come, with no depreciation from fees.
9.) Who is funding FITE?
As the founding partner of FITE, Dermalogica has committed to fund the startup of the FITE program, both individual microloans and the larger education program on which we are embarking with Kiva. However, we cannot do it alone – we need your help and participation at joinFITE.org to reach our goal. We do also welcome your direct donations to FITE, allowing you to support a woman entrepreneur in need. Make a microloan now!
10.) Why is FITE focused on microfinance?
We believe in sustainable solutions and appreciate what microfinance has done and is doing to help communities become more self-sustaining. It’s a hand-up, not a hand-out. Once the loan recipient has gotten her business up-and-running, and has repaid her loan to her field partner (MFI), the money is returned to us, where we reloan it to another entrepreneur. And so the cycle continues!
11.) Are any FITE partners MFIs?
No, none of the FITE partners are a microfinance institution. We are partnering with Kiva, and its worldwide network of MFI field partners, who will help identify loan recipients, as well as handle the loan transaction.
12.) Why does microfinance make a difference in the current global economic crisis?
Microfinance is especially important during an economic crisis. When large companies reduce the number of people they employ, self-employment is often the only income-generating option available to many people. Small businesses are the backbone of our economy; they provide more than half the jobs and productive activity for the nation. However, many of these businesses struggle because they cannot access the financial tools they need to start or grow. Without these businesses, the economy will not be able to recover. As credit markets tighten in the current crisis, small businesses are being placed under even greater stress. Microfinance provides these critical businesses with the tools they need to survive and thus stimulate economic growth that benefits the wider economy.
13.) Are you open to working with any other partners?
Yes. Alliances that can help promote the FITE cause are always of interest to us. These could be alliances with other companies, or other nonprofit organizations. We have some very turnkey ways for partners to sign up and get involved, or we can customize a partnership based on our mutual goals. If you are interested in a partnership, let us know by emailing us at FITEmail@joinFITE.org.
14.) Who actually handles the processing of the loan to the borrower?
Kiva’s network of field partners (MFIs) around the world enroll borrowers into the program, process their applications, fund the loan and work with the borrower on a repayment schedule. These MFIs upload and update their records frequently on the Kiva site.
15.) What parts of the world does Kiva and its field partners operate?
Kiva operates throughout North, South and Central Americas, Asia, Africa, the Middle East and Europe. Kiva is constantly expanding its field partner network worldwide, and adds a field partner every few days. Chances are, if Kiva doesn’t operate in your local country today, they will very soon!
16.) How does Kiva select its network of field partners/MFIs?
Kiva.org has an extensive due diligence process which every partner must successfully pass, which includes looking at their social mission, looking at their lending history, evaluating the organization’s financials, looking at third-party audits and conducting substantial reference checks within the industry.
17.) How does Kiva choose which entrepreneurs appear on their site, and receive microloan funding?
By working with local microfinance institutions on the ground, who are familiar with the local customs, with the history of lending in that region and cultural implications, Kiva has gained years and years of valuable experience. As the experts, the application and vetting process is handled by Kiva.. The approval process varies from region to region, but it can include requiring the entrepreneur to complete business training, talking to the community to find out if the entrepreneur is hard working and honest and evaluating the business plan to make sure the business has a great chance at success.
18.) Why is Kiva is some countries, and not others? Also, why is Kiva’s primary focus on the developing world?
While Kiva strives to become a global organization, there are a number of factors involved in bringing new countries online that they carefully consider before engaging in a certain market. The result of this consideration has helped Kiva prioritize markets for their first stages of growth – but it is important to understand that Kiva is constantly adding new countries, so even if your country is not part of the Kiva platform today, it may well be soon. We should also recognize that Kiva has accomplished incredible global coverage in their four years since launch, especially given the complex and shifting legal regulations related to financial markets in each part of the world.
Kiva determines their list of country priorities as follows:
How great is the need? While all countries can benefit, in some way, from microfinance, not all countries have the same level of need. For example, developed countries like Australia, the United Kingdom, the USA, Canada and others have well-established credit markets that are available to women without prejudice. While it’s not to say that these countries will not come online with Kiva at some point, our combined priority is to focus on markets where women cannot fairly and safely access the credit they would need to start or grow a business.
Is the market stable? MFIs (microfinance field partners) thrive in countries where society is fairly stable, and there is a rule of law. Unfortunately, many parts of the world are in such tumult that they do not have the type of environment where an MFI – who are, after all, the feet on the ground of microfinance – could safely be established.
Do the MFIs meet Kiva’s standards? Kiva has a strong code of ethics as it relates to borrower privacy and fairness, and puts all prospective MFIs through a very stringent evaluation to ensure that they are upholding Kiva’s values and banking practices. This process takes several months, during which Kiva evaluates the MFI on paper, and then puts it through a “test” period to ensure that they embrace the values in practice, as well. Kiva has several countries (including South Africa) with MFIs in the evaluation or testing process, so we can look forward to enrolling more markets around the world in joinFITE.org soon.
19.) Are the microloan recipients charged interest?
Yes. The local organizations charge a fair interest rate to the entrepreneurs, which covers the cost of running their operations. This is essential to creating a self-sustainable tool to fight poverty, which we believe is very important. The poor need specialized financial services which usually cost more. For example, many of Kiva.org’s partners actually go to each of their clients every day to collect small repayments on a loan – because this best serves their clients. Many of the poor live in remote areas and so it is costly to reach them. Also, when you are dealing with such small transaction sizes the interest rate needs to be a little higher to cover costs than if the transaction sizes were larger. However a small investment in a business can triple the profits an entrepreneur receives, so the interest rate is definitely affordable while also giving the entrepreneur enough profit to lift themselves out of poverty.
20.) What happens when an entrepreneur repays her loan? Will the loans be repaid to the FITE partners?
When the entrepreneur repays her loan to her MFI, the funds are channeled back to FITE. These funds will then be re-loaned to another recipient. And, since the repayment rate of microloans averages close to 99%, the funds in the FITE program will help entrepreneurs for years to come!
21.) What is a lending team?
Lending teams are virtual communities of individuals who share common values, workplaces, etc. We suggest you mention your lending team during redemption, so that we can recognize their efforts in joining FITE. Being a member of a lending team does not affect your options, or the value of your redemption – it’s just a neat way to help build community within the FITE program. In addition, we will be checking out the different FITE lending teams, and rewarding those who are working extra hard at joining the FITE!
22.) Why is the donation calculated in US dollars?
In order to keep the communication and redemption process simple, we are staying consistent with Kiva’s business practice of promoting and funding microloans in US dollars. The local field partners, of course, provide the loan in local currencies. By handling our part of the program in US dollars, we avoid the complexity of continual currency fluctuations, as well as the complex site localization that 51 currencies would require.
23.) If I make an additional donation to KIVA (through the FITE program), is that donation tax-deductible?
Kiva is a 501 (c)(3) non-profit organization in the USA, meaning that donations to Kiva’s operating expenses are usually tax-deductible for US taxpayers. Money directed towards the funding of a microloan (through the MAKE A LOAN link) are not tax-deductible, since there is a probability that the funds will be repaid to you. Please speak to your tax planner for full information on your specific tax situation.
24.) How can I track how much money has been raised by the FITE program, in my country?
Every time you make a donation through joinFITE.org, you will be prompted to select your country. This informationwill help us to properly allocate the funds. You can view your country’s successes any time by visiting its Lending Team page on the joinFITE.org website.
25.) What can I do to make FITE successful?
Start by joining the FITE at joinFITE.org! Then, involve your friends through our Facebook page, and get as many of them to join the FITE as possible.