While humanitarian aid provides vital relief to refugees in the short term, access to finance is one of the most powerful tools to help refugees rebuild their futures in the long term. However, without credit histories, formal identification, or stable addresses, refugees often face significant barriers to accessing financial services. This limits their ability to start a business, pursue further education, or support their families. Additionally, refugees may face bias or misconceptions about their ability to repay loans.
Recognizing the critical role of financial access in helping refugees rebuild their lives, Kiva has been committed to advancing it for refugees and communities impacted by forced displacement since 2016. Kiva partners with 21 local organizations across 15 countries that strive to connect displaced populations with the financial services they need to restart their lives.
Though the needs of displaced people across such a wide geography are bound to vary, there is a growing recognition of best practices that help address the common barriers refugees face while helping achieve the greatest impact.
To assess the extent to which Kiva’s local Lending Partners are able to support refugees and displaced populations, Kiva launched its proprietary Refugee & Displacement Assessment of Readiness (RADAR) tool in 2024.
Much like Kiva’s Gender Equity Assessment & Rating (GEAR) tool, which looks at how partners integrate gender considerations into their products, processes, and services, Kiva developed the RADAR tool to provide Kiva with a holistic understanding of how and to what extent Kiva’s Lending Partners are supporting financial access for displaced populations. All of Kiva partners that focus on serving refugees and internally displaced people receive a RADAR score.
Here’s a deep dive into the RADAR tool and how it works:
What are some of the areas RADAR looks at?
RADAR looks at how refugee-centric a Lending Partner is by exploring their approaches across three components: how the partner targets refugee clients as a segment (“Targeting”), the processes that inform the partner’s understanding of their clients and the policies guiding their internal operations (“Process”), and the products and services the partner offers to refugees (“Product”).
Targeting: Who is being served & what are their alternatives
The first component assesses the extent to which a financial service provider reaches refugee clients, as well as whether there would be alternative options. If a local partner is the only institution offering financial services to refugees in a given area, this represents an opportunity for greater impact due to the lack of available alternatives.
Process: Understanding & protecting refugee clients
Having a clear understanding of clients is critical to serving any group well, and nowhere is this more true than with refugees. The “Process” component evaluates how the partner considers the voices and needs of displaced people. It also assesses whether Lending Partners can disaggregate data by refugee status to identify what is working for refugees and use this data to improve their institutional offerings.
In addition to exploring client understanding, this component also explores the Lending Partner’s level of refugee representation across its workforce, including staff and leadership positions. Hiring refugees on staff can provide another avenue to improve client understanding and helps increase trust and rapport with a displaced group that may be skeptical of financial institutions.
Finally, this component gauges how the Lending Partner supports the protection of its clients by training its staff to avoid anti-refugee bias and to promote the integration of refugee clients into their host communities.
Product: Making products & services relevant to refugees
The third component of RADAR assesses the extent to which a Lending Partner offers products and services shown to be most helpful for refugees, with a particular focus on the accessibility and flexibility of product offerings.
Given the common barriers refugees face, a key starting point for financial services is flexibility in basic requirements such as documentation and collateral. Though a partner may only flex their documentation requirements within the bounds of what the host country allows, in some cases, a Lending Partner can adjust their requirements to accept alternative IDs, such as a government-issued refugee ID or an expired passport.
In terms of collateral, a Lending Partner may avoid requiring traditional collateral by covering their risk through approaches such as group lending. This allows someone who had to leave everything behind to still access credit.
Beyond credit, offering savings accounts and other financial services is critical to help refugees build their resilience and plan for the future.
Additionally, comprehensive non-financial services are not only a valuable add-on to standardized financial services, but are an essential aspect of successfully serving refugees. They can help teach skills critical to a refugee’s new life, such as language, digital literacy, household budgeting, and more. Market trainings can help refugees understand their legal rights and rules for business registration and tax payments, and business training can help refugees connect to local markets, value chains, and business practices.
What are some of the insights from RADAR?
These are some of the insights Kiva has gleaned from the RADAR tool:
Overall, about 1 in 4 of all Kiva Lending Partners indicate that they serve refugees as one of their specific client segments.
Kiva partners that serve refugees as one of their target populations perform 11% higher than the global average on their overall Impact Score, which is Kiva’s tool for evaluating the impact potential of partners. This suggests that Lending Partners serving refugees and displaced populations have adopted policies and practices that are connected to higher impact, not just for refugees, but for a variety of clients.
Two-thirds of partners serving refugees offer at least two accessible ways for refugees to engage with their products and services, like mobile outreach, flexible ID requirements, and multilingual communication.
All of Kiva’s partners that support refugees use some form of data collection, like pilot studies, client needs assessments, and market research, to specifically understand their refugee clients.
The tool has also revealed gaps that, once addressed, may positively affect the efficacy and reach of our partners’ growing refugee lending programs:
41% of partners serving refugees indicated that they had refugees on their staff. As we’ve learned, hiring members of the refugee community is a crucial way to increase trust with refugee clients, who may be skeptical of lending institutions or need to communicate in a different language than that of their host country.
1 in 2 partners serving refugees provide refugee anti-bias training to their employees, presenting a clear opportunity to improve client access and experience.
How does Kiva use RADAR?
Kiva uses RADAR results to identify institutional strengths and opportunities for growth in refugee-focused processes. The data from RADAR helps Kiva understand where our partners are experiencing gaps and where we can start conversations to bridge them.
It also allows us to see patterns across geographies where regional-level support may be needed.
In addition, RADAR provides a helpful lens through which to evaluate new institutions Kiva may consider partnering with.
What comes next?
Kiva will take the insights from RADAR to broach conversations with partners about expanding their capacity to serve refugees. This data will also serve as a baseline for future measurement, as Lending Partners will receive new RADAR scores every few years.
Additionally, while RADAR provides key insights about the capacity and approaches of Lending Partners, it is critical to continue measuring other facets of impact to holistically understand how financial access impacts refugees, especially at the borrower level.
To complement RADAR, Kiva monitors the breadth of impact on refugees by examining how many people are reached, the sizes of their loans, their repayment rates, and more.
Kiva also evaluates the depth of impact on displaced borrowers by conducting standardized outcome studies with selected Lending Partners. This provides insight into the real, day-to-day impact of improved financial access.
Finally, through targeted longitudinal studies, needs assessments, and documenting lessons learned, Kiva will strengthen the evidence base for why refugee lending is both viable and deeply impactful.
Refugee lending is one area that Kiva has pioneered. We’ve shown that refugees and displaced people are just as capable of repaying a loan as anyone else, and continue to build on that knowledge to better understand the needs of refugee borrowers and the barriers they face. And, we use that knowledge to track what types of loan products best meet their needs over time.
Kiva is committed to learning and maturing in a way that puts our borrowers first, and tools like RADAR recognize the critical role that our Lending Partners play in breaking down institutional barriers and creating opportunity through innovative solutions for refugees.
We are excited to continue to grow the collective impact that Kiva lenders, Lending Partners, and strategic partners are championing for the over 120million refugees and internally displaced people worldwide.
