There are now at least 17 websites offering the opportunity for individuals to direct as little as USD 20 to microborrowers in both rich and poor countries, including: Babyloan, Good Return, Kiva, MicroPlace, MyElen.com, MYC4, Veecus, Xetic.org, 51Give, Rang De, Wokai, DhanaX, p2p Microfinance, Zidisha, Inuka, Acceder and OptInNow. Most of these websites post information on potential borrowers that can be viewed by lenders, but most channel funds to microlenders that may use the money to lend to any of their clients. In most cases, these investments do not yield any returns to investors. Others such as MicroPlace, MYC4, MyElen.com, p2p Microfinance, DhanaX and Zidisha pay an interest to their investors. Still others do not allow the “lender” to withdraw funds at any time, instead using the donation to capitalize lending pools.
Kiva, a US-based nonprofit that allows lenders to withdraw repaid loans without interest, was the first website offering this type of service. As of April 2011, Kiva reports that: it has engaged 915,000 individual lenders, 81 percent of loans have been made to women entrepreneurs, the repayment rate on these loans is 98.7 percent and the average loan size is USD 382.
By Medha Ravi, Research Associate
About Kiva:
Incorporated in 2005, Kiva is a US-based online portal allowing individuals to make loans to microfinance institutions (MFIs), which then make loans to people with low incomes. Kiva partners with microfinance institutions (MFIs) in 60 developing and rich countries. As of April 2011, Kiva reports that: it has engaged 915,000 individual lenders, 81 percent of loans have been made to women entrepreneurs, the repayment rate on these loans is 98.7 percent and the average loan size is USD 382.
Source and Resources:
[1] Microfinance Focus news article, “13 Microfinance Internet Marketplaces help you to invest in Microbusinesses”, http://microfinancefocus.com/13-microfinance-internet-marketplaces-help-you-invest-microbusinesses
MicroCapital.org story, April 28, 2011, “MICROCAPITAL BRIEF: Kiva Intermediates “Green Loans” From Individuals to Promote Clean Energy Efforts Worldwide”, https://www.microcapital.org/microcapital-brief-kiva-intermediates-green-loans-from-individuals-to-promote-clean-energy-efforts-worldwide/
MicroCapital.org story, April 25, 2011, “MICROCAPITAL BRIEF: Zidisha Online Lending Platform Offering Borrower Performance Ratings, Facilitates $50k in Loans”, https://www.microcapital.org/microcapital-brief-zidisha-online-lending-platform-offering-borrower-performance-ratings-facilitates-50k-in-loans/
NEWS WIRE: United States: New York Times Calls Kiva’s “Person to Person” Model an “Illusion”, https://www.microcapital.org/news-wire-united-states-new-york-times-calls-kivas-person-to-person-model-an-illusion/
MicroCapital Universe Profile: Kiva, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Kiva
Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/
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