[notahacker]

The main reason is that administering small loans is expensive: costs of administering/chasing the debt don't really scale down just because the loan itself is only $50, and most of these entities seek to turn a profit too. Additionally there's a suspicion the middlemen sometimes use other loans' interest payments to cover defaults since nonrepayment makes them look bad to Kiva lenders.

Zidisha (YC14, nonprofit) cut out the middleman to do pure P2P lending in the developing world at much lower rates but at least when I was on the platform had significant issues with defaults even with local volunteers helping with chasing (and some defaults definitely weren't planned).