Kiva: loans, points, and miles

Making Kiva loans is one of my favorite ways to increase credit card spend.  Kiva loans help me reach minimum spend requirements for new credit cards; they help me reach credit card big spend bonus thresholds; and, most importantly, they help people around the world who need micro-loans, usually for starting or maintaining a small business.

With Kiva, you can make loans with your credit card, and the transactions count as regular purchases for the purpose of earning credit card rewards.  You do not have to worry about being charged cash advance fees.

Overall, Kiva has a very low loan default rate of .95% (just under 1%).  In my loan portfolio, the default rate has been an amazingly low .21%.  That performance is probably due to the fact that I usually filter to “safe” loans as I’ll explain below in the tips and tricks section of this post.

The downsides

It’s not all roses and ponies in Kiva land:

  • Loans take anywhere from 4 months to a few years to pay off in full, so don’t loan more than you can afford.  That money will be inaccessible for quite a while.
  • You will not earn interest on your loans.  Borrowers do pay interest, but those payments go to the micro-lenders who are in place around the world and need that money for the good work that they do.
  • Payments are made through PayPal.  If you log into PayPal and you have a balance in your account, PayPal will try to use that balance before charging your credit card.  You can avoid that by not logging in, or by using a PayPal account with no balance.
  • Once loans are repaid, withdrawals are made manually so they can take a week or two to process.

Tips and Tricks

Make safe loans

Kiva lets you filter loans to those that are most likely to pay back in full.  When browsing for loans, select “advanced options” to bring up the filter options.  Here’s an example of settings I would choose:

kiva_advanced_options

Make lots of loans at once

If you want to make many loans at once, you can turn to a web app called kivalens.org.  It lets you filter loans in even more ways than shown above, sort them by earliest payoff date, and bulk load them into your Kiva “shopping cart”.  Press the “++” button to add lots of loans at once.  You can specify how much to spend per loan and how much total you want to spend.

kivalens_frequentmiler

Pay with the best credit card

Depending on your goals, you may prefer to pay with a new credit card to help meet minimum spend requirements, or pay with a credit card in which you’re trying to achieve a big spend bonus.  Alternatively, consider using the US Bank FlexPerks or Cash+ cards which offer bonus points for charity spend.  Even though Kiva loans aren’t charitable donations, Kiva is coded as a charity and therefore earns extra points with these cards (With Cash+ you would have to select Charity as one of your 5% bonus categories).

Increase credit card spend from home or abroad

Many of the techniques people use to increase credit card spend involve trips to drug stores, grocery stores, and Walmart to buy or unload gift cards and reload cards.  If you prefer to stay home, or you travel often abroad, those techniques probably aren’t much use to you.  Kiva loans can be a good alternative.  Note that if you are abroad, it’s a good idea to use a VPN, or remote control software to make your Kiva payments appear to come from the US.  Otherwise, PayPal may stop the payments because they’ll appear to be suspicious.

Getting started

  1. If you haven’t already signed up with Kiva, you can do so through my link: www.kiva.org/invitedto/milepoint/by/FrequentMiler.  I won’t earn any referral credit or anything, but I will get an email saying that my friend has joined Kiva.
  2. Find a loan and finance it here: www.kiva.org/lend.

About Greg The Frequent Miler

Greg is the owner, founder, and primary author of the Frequent Miler. He earns millions of points and miles each year, mostly without flying, and dedicates this blog to teaching others how to do the same.

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Prince of Points
Guest

For meeting min spend req I agree Kiva can be a great tool. But for normal manuspend – even when using a usbank card, this is in direct violation of your “buying miles” conundrum. Other p2p loan sites like Lending Club offer well over 10% annual return. This will always buy more miles than using your capital to “buy” them through Kiva.

Joe Gifted
Guest
Joe Gifted

@Prince, Although it is in direct violation, There is a risk that they will default on the loan. Furthermore you to make a decent amount of miles you are putting out money with no return for usually six months.
Finally I believe that since you are in effect making a difference that this could be considered a “rule bender”.

Steve
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Steve

Thanks to your past posts I follow this strategy and my results have been very similar to yours. Lately I find vast majority of loans that fit are in Phillipines. Do you worry about geographic loan concentration? I do not want to have more than 25% of loans in any country so have had to dramatically slow my Kiva lending down, as I do not want to lower the quality standards to get more diversity.

Nun
Guest
Nun

Whether you’re “helping” someone should be irrelevant. You have no idea if you’re really helping someone or if this person will the use the money as stated. For all you know microloans are being funneled somewhere else in the world.

Joe Gifted
Guest
Joe Gifted

@Nun
It is wholly relevant. That is the point of kiva.

Gagne
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Gagne

Looks that only good for meeting sign-up bonus requirement, not for manuspending?

HeavenlyJane
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HeavenlyJane

kivalens.org does not work on an iPad?

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[…] and Notes from Around the Interweb: Doing well by doing good: generating spending and miles and points by making Kiva micro-loans (that should eventually get repaid). There’s an entire forum dedicated to discussing Kiva on […]

Bo Hale
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Bo Hale

Do you think USBank will shut you down for perk abuse if you overdo it with Kiva loans?

cindi
Guest
cindi

I went to the us bank site and there is nothing about 5x points to charity. Also went to aarp site and nothing about 7% rebate. Have these bonuses been removed?

jd
Guest
jd

I have always wanted do try Kiva, and started today with my newly arrived Flexperks visa signature card, hoping to earn the 3X points. However, I am seeing the pending charge on US bank website as “paypal*Kiva”, does that mean I made some mistake somewhere? Will USBank categorize transactions labeled “paypal*Kiva” as charitable donation? Thanks.

jd
Guest
jd

Thanks! Did you notice today that Kiva has changed its interface slightly when it comes to payment: the “pay with credit card/debit card” option is gone, and it asks you to fill in your address and phone before letting you input your credit card info. When you finish payment, say of $25 or $50, the amount does not automatically becomes a new loan, it becomes a credit on your account, and you have to click “lend” button again to lend the credit on your account to the borrower. I wonder if this change affects the Flexperks points earning or not. Maybe you can talk about it?

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[…] Make Kiva loans. […]

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[…] Make Kiva loans. […]

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[…] well while doing good, and for folks not worried about short-term liquidity, it’s great to fund microloans with Kiva. You can fund with your credit card, they have an amazing repayment rate, and when the […]

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[…]  If you’re applying for the U.S. Bank FlexPerks Travel Rewards Visa Signature card, some folks have reported being able to get the 3X points on charitable donations on Kiva […]

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[…] of making Kiva loans, I currently have a 99.39% payback rate.  For more details, please see Kiva: loans, points, and miles.  Keep in mind that loan terms range from about 6 months to much more, so don’t loan money […]

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[…] best option for donations to charity and/or loans made through charitable organizations, such as Kiva (another great option is the US Bank Cash+ card with which it is possible to earn 5% cash back in […]

Aureliano
Guest
Aureliano

Hi, FM. I signed up through your link but didn’t see the $25 credit. Is that dead?

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[…] Make Kiva loans. […]

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[…] U.S. Bank FlexPerks® Travel Rewards American Express® card:  You’ll only earn 1 point per dollar when using this card to load Serve, but points are worth up to 2 cents each when used to purchase flights (see: Maximizing value from the U.S. Bank FlexPerks Travel Rewards Card).  Plus, cardholders get 3,500 bonus points when they spend $24,000 in a year on the card.  Serve can be used to get you half way there.  For reference, this card also earns 2 points per dollar for gas, groceries, or airline purchases (whichever is most each billing cycle); 2 points per dollar at restaurants; and 3 points per dollar for charities (I especially like to use this card for Kiva loans). […]

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[…] $1 holds can make the cards difficult to drain completely.   This is usually just an online purchase problem, but it is a hassle.  One example is with Kiva loans which can be paid for with Amex gift cards.  If you try to make exactly $2000 worth of loans, for example, and pay with a $2000 Amex gift card, the transaction will be declined.  The reason is that PayPal will first verify the card by placing a $1 hold.  This reduces the available balance on the card to $1999 for quite a while (its been a while since I’ve done this, but my admittedly shaky memory tells me that I’ve had to wait up to a week for the hold to clear).  Read more about Kiva here: Kiva: loans, points, and miles. […]

Jolly
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Jolly

Any advice on getting kivalens to work these days?

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[…] published a primer on increasing credit card spend through Kiva in 2013 (see: Kiva: loans, points, and miles).  I believe that all of the basic info there is still correct today, so I’ll simply summarize […]

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[…] The US Bank FlexPerks card is one of my favorite secondary points programs card.  The card offers 3X points for charities, 2X points for cell phone, and 2X for gas, grocery, or airline purchases (whichever is most each month).  I find it particularly convenient that Kiva is considered a charity.  […]

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[…] allow lenders to earn interest, so the best you can do is break even.  For details, please see: Kiva: loans, points, and miles.  Another option is Kickfurther (if you use this referral link, you’ll earn $5 to get […]

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[…] Kiva: loans, points, and miles […]

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[…] Kiva: loans, points, and miles […]

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[…] If you’ve been meaning to make donations to your favorite charities, now is the time!  Keep in mind, though, that the charity will have to pay the credit card processing fee in most cases. Alternatively, fund microloans with the hope of getting most of your money back (see “Kiva: loans, points, and miles“). […]