Microfinance Update

I’ve now loaned (or in one case, tried to) through all of the microfinance groups I posted about in my last entry (click on the “microfinance” tag to find it), so I thought I’d post a quick update on general ease of use, since  it will be quite a while before I have any confirmation of how often I get updated, whether I get the money back, etc.

MicroPlace: Very easy to use.  The sorting feature is a bit counterintuitive at first for me, but allows you to search by a number of useful features, such as level of poverty, focus on women, fair-trade, repayment term, interest rate, etc.  You get to see the entire 20-40 page loan prospectus, so in terms of transparency they’re golden so far.  A little overwhelming, but golden.  The “my account” feature is easy to understand, with a nice little table of when and how much each loan will repay.  As part of the registration, they ask for approximate income and investment experience, and have helpful notifications to make sure that you aren’t investing more than you can afford and that you realize the investments are risky. (Individually, microfinance clients have an extremely high repayment rate.   They’re just often in areas that have a higher chance of, say, descending into civil war at the drop of a hat or getting swept away by a hurricane.)

Lend For Peace:  Easy to use, but only allows you to lend to one entrepreneur at a time — you have to go through the whole payment process again to lend to someone else.  I’m going to contact them and ask about it; I may well have just clicked on the wrong button.

United Prosperity: Very easy to use.  You can lend as little as $10 to each client, which let me lend to several to spread my funds around nicely.

Wokai: Very nice loan writeups — much more detail than any of the other sites.  Selecting loans went very smoothly.  Like United Prosperity, you can lend as little as $10.  They also tend to have smaller loan amounts than some other sites, so it feels like my money’s going further.  But they don’t seem to allow payment through Paypal, which messes up my “recycle Kiva funds” plan somewhat (Kiva credit can only be repayed through Paypal), and I had a glitch with Google Checkout.  I’ve asked them about it, and I’ll try again later.


2 Responses so far »

  1. 1

    Thank you for writing about United Prosperity. I would like to add a couple of points about United Prosperity.
    1. Due to our unique loan guarantee model, your $1 in guarantee translates to nearly $2 in microloan nearly doubling your impact. On loan repayment you get your money back.
    2. Since the loans are made in local currency by the bank, foreign exchange risk is mitigated for individual guarantors, entrepreneurs and Microfinance institutions.

    We also work with entrepreneurs in extreme poverty. i.e. living on less than $2 a day.

    Thanks again for writing about us.

    Founder and CEO

  2. 2

    risa b said,

    Did not know we can do this. Thanks for the tip!

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