As JDiver mentioned, I was a Kiva Fellow at a one of their partners here in Phnom Penh for 3.5 months (and I still haven't been able to tear myself away from Cambodia yet!). Kiva staff does regular audits and visits of their partners to make sure that everything is on the up and up. They also send Kiva Fellows to work at the partners for extended periods of time, usually three months, to do more intensive audits and to make sure that everything is kosher. One of the things fellows do is called borrower verification where we are given a list of ten random borrowers and have to verify everything about them and their loan -- are they who the loan says they are, is the picture of the correct person, was the loan given in the right amount, what was the loan used for, has every payment been recorded accurately, etc. We check the receipts of the customer in the field against what the partner has recorded in their system against what is reported on Kiva. Overall, I feel Kiva does a fair amount of monitoring and I trust that my loans are going to the places they say they are.

Another issue that has been brought up is overindebtedness. This is something that I am very interested in as well. In Cambodia there are more than twenty microfinance institutions (MFIs) -- 4 of which are on Kiva -- and many borrowers take out loans from multiple MFIs. Because there is no credit bureau here, it's very difficult for an MFI to determine whether a borrower already has other loans out when they are making their loan decision. If the borrower and their village chief are willing to lie, there's not a lot the MFI can do about it right now. So that's a problem and it's a problem that Kiva is aware of. In my personal opinion I think Kiva should not bother with partners in places with a large number of MFIs. Not to say that those MFIs aren't doing good work -- the one I worked at here, Maxima, is a group of caring honest people that I really like -- but the interest-free Kiva money could be better directed to provide loans for people that wouldn't otherwise get it. When there are 20 MFIs in a place, most people will be able to get a loan one way or another if they have some sort of collateral.