India is a country of villages where 70% population lies in these villages. There is huge migration of population from Villages to big cities because of less employment opportunity in these villages. There are so many entrepreneur who are migrating to cities in search of jobs because they don’t have the availability of seed capital with which they can start their own business.

Rang De is an effort to stop this brain-drain. Rang De is an opportunity to provide the seed capital to these entrepreneurs to setup their own business and fulfill their dreams. Rang De enables Peer-Peer lending in India so that people can grow together. Rang De is a not-for-profit organization that enables Indian to lend(Micro lending) as little 100 Rs(around $ 2.2) to low income households to start business. In short, anyone can become a banker to the poor, creating new opportunity for them, allowing them to succeed without having to migrate to overburdened cities.

For people who are familiar with Kiva, Rang De leverages the internet to raise funds which is akin to Kiva.  The key differentiators being Rang De’s mission of leveraging the model to drive down interest rates and its focus on India. Rang De’s borrowers pay interest rates ranging from 6% flat p.a. to 10% flat p.a. Rang De has it’s head quarter in Chennai(India). It was started on 26th Jan, 2008 and with in less than 3 years of span, it has raised social investment of $ 720,000 and affected 6088 borrowers. Rang De has Volunteer chapters in major Indian cities and abroad which help to spread awareness among local communities, help Rang De in day-to-day work, help to find the new field partner to reach  every corner of India, help to setup field trips to make sure borrowers are not trapped under any kind of exploitation. Right now, Rang De has presence in 12 states of India and approaching a missing to cover all the states.

Rang De Chapters have been established in cities across India and abroad in order to spread the awareness of Rang De and microcredit. The chapters enable individuals to participate in this movement. Through this platform Rang De’s social investors and volunteers work towards Rang De’s mission of making affordable micro-credit available to every low income household in India.  This portal aims to bring together the members of the various Rang De Chapters by allowing them to showcase their activities and communicate with members of other chapters.

Within India
Bangalore
Chennai
Hyderabad
Kolkata
Mumbai
Pune
Delhi

Outside India
Dallas
New Jersey
Singapore
Cincinnati
Seattle
SanFrancisco
United Kingdom

Student Chapters
PSG Institute

I was just taking a look at Wokai as a result of a post on Facebook (linking to this post about moving Wokai to the cloud) — and noticed a feature I absolutely LOVE when I signed in. Contribution Plans!

Uploaded with Skitch!

The feature allows a registered member of Wokai to set up a recurring contribution (to entrepreneurs in China) and/or donation (to Wokai overhead) that will be billed either monthly or quarterly to a credit card. For instance, I just set up a donation of $25 every three months with a $10 donation to Wokai. It’s not much, but every little bit counts. I’ve long been a supporter of the organization and would have donated more often had this feature been in existence since the beginning. But now, I can no longer use the excuse that “I forgot” when it comes to donating — but unfortunately I’ll have to use that one for my lack of donations over the past couple years

This is an unbelievably smart feature on Wokai’s part, and one that not even Kiva has implemented yet (if I’m wrong on that, let me know). It’s a fact that donors around the globe are being bombarded from all angles with pitches to help NGO A, NGO B, and NGO C — but now, if Wokai can win their attention once (no small task), they have the ability to sign up recurring donors rather than relying on email marketing to bring donors back to make additional transactions. I have no idea the actual numbers, but I’m betting a recurring donor is at least 10x as valuable to Wokai (since you have to factor in donor acquisition costs) than a one time donor.

To access and set up a Wokai contribution plan for yourself, just login and click the “Contribution Plan” option within your “My Wokai“.

I’m willing to bet that more peer to peer lending platforms, and other non profits for that matter, will start implementing this feature in the near future.

Happy [continual] contributing!!

I know I’m writing this one a little late (been traveling in Asia) but wanted to give a shout out to Vittana and United Prosperity.  Both Microfinance platforms have recently reach over $100,000 in loans!  There are of course other platforms that have exceeded this already, but Vittana and UnitedProsperity are two that have launched within the last year and have taken a new spin on lending.  It is great to see that even through a recession, people are still finding the time to help other people who are even more in need.  Here are some kind words from each:

Vittana:

We launched a brand-new website and a huge marketing campaign around March Madness that just ended last night. In the process, we doubled our user base, passed $100,000 in total amount lent, then turned around and raised over $50,000 in March alone, ultimately helping fund over 100 students. Because of you, those students are able to get their degrees to become nurses, accountants, lawyers, mechanics, teachers and much more.
Wow! Now, it’s time to celebrate. We’re going to be hanging out on the upper level of Barça on Capitol Hill with our friends from SeaMo (Seattle Microfinance) all evening on Friday, so come grab a drink with us. We want to celebrate with the people who made it happen – you, our lenders. So come after work, bring a friend, and we’ll have a fantastic time.

UnitedProsperity:

Thank you very much for  helping  Unitedprosperity.org reach the major milestone of providing US$100,000 in loans to 500 entrepreneurs living in extreme poverty since our launch in May 2009. These entrepreneurs and their families are typically living on $2 a day, and have one vision – to grow their businesses and thereby improve their lives. Thanks to your support, these entrepreneurs have been able to realize their dreams and improve their lives. Please visit the impact section to see how these ‘microloans’  are being used for a variety of initiatives ranging from buying cattle for milk to building product inventory in their small shops.

At some point, everyone has received an email or message, whether it be through facebook, gmail, MSN, etc, from an annonymous person saying that they would like to meet up.  I think most people know the trick by now, but every once and a while, it looks real.  Earlier this month, I received an email on Wokai that I got a message from a new user.  I didn’t recognize the name, but luckily I was busy and didn’t open it.  It was a spam email that was sent out to all users.  I don’t think the email would have done too much harm, but it was unexpected to see it within the microfinance community.  Wokai, had caught this the next day and had done a great job of sending out a formal apology and letting everybody know of the incident.  I’m not quite sure what all it entails on the backend to help stop this in the future, I’m sure Wokai has already solved it.  The spam wasn’t a big issue, but it sucks to see that it is in microfinance as well.  I’m sure it has already happened a bunch, but this was one case that didn’t get caught by any of my filters either, so it stood out.  I think with the close circle of people in the microfinance community, as well as the smart people building out platforms/MFIs, we can narrow down the spammers, but it just sucks knowing that first time lenders could get a spam email and get discouraged.  Props to Wokai for handling the situation so professionally.

Throughout the month of March, Vittana has been running their first — but not their last – March Microfinance Madness campaign with the goal of getting friends, family, and co-workers coming together to raise money to send kids to school. For those of you not familiar with Vittana,they are enabling students from around the globe to get access to higher education for the first time through student loans. They’ve gotten a fair amount of interest for their campaign, including TechCrunch, Redfin, Buddy.tv, and TeachStreet, but are running into the home stretch with only 6 days left in March and want to put the after burners on.

If you’d like to loan to a student in Paraguay, Vietnam, or Nicaragua, I just created a “myKRO.org” group on Vittana – just sign up, find a student such as Huyen Thi Hoang in Vietnam, and lend! Remember, every little bit helps!

World Vision recently launched their own Kive-like lending platform named Micro. They are the latest microfinance lending platform to launch, joining more established players such as Kiva, Wokai, and Microplace. It looks like the site was launched in September (also on UrbanMinistry), but I was made aware of the site from SocialEarth’s blog post today. According to their site, World Vision has disbursed 3,500,000 loans totaling more than $1.8 billion since 1993, has 604,000 active entrepreneurs, and loaned $396 million last year — so they are not new to microfinance by any means. Loan sizes range from $25 all the way up to $500+. Currently, Micro only offers loans for entrepreneurs in Rwanda, Mexico, and the Phillipines — but I’d guess they will be adding new markets in the coming year.

I’m certainly a fan of anything that brings microfinance into the spotlight and am thrilled that World Vision is tapping their existing donors to help raise capital for microfinance, but am yet to be convinced software development time and effort should continue to be spent on building technology to power lending platforms. As I said in August, I’d still like to see Kiva.org open source, or white-label, some of their software to other players in the market who want to specialize in a particular geographic area or type of business; that would enable development time and dollars to be spent building features on top of some of the great P2P lending technology that already exists.

For those interested in following Micro’s progress, you can follow them on Twitter here. Head over to SocialEarth for more details.

Casey Wilson recently had a great email that she sent out about the recent articles about Kiva in the NY times that I thought was worth posting:

You might have read Stephanie Strom’s article “Confusion Where Money Lent via Kiva Goes” in the New York Times a few days ago.  This issue has been making the rounds since David Roodman’s post a month ago.  As a fellow “peer-to-peer” microfinance organization, we thought it was important for us to follow up with our own supporters on this issue.

To be clear, contributions on Wokai go to microfinance institutions (our “Field Partners”) in rural China, who are in charge of distributing the loans to the borrowers and collecting repayment.  A borrower can in fact receive a loan from a Field Partner prior the time the loan is “100% funded” on the Wokai website.  Below are two excerpts from Wokai’s FAQ that might shed more light on the issue.

Can a recipient’s loan start before it is 100% funded?

Yes. Once a Field Partner has posted a recipient’s profile online, Wokai Field Partners can use their own capital to issue that recipient’s loan. Wokai then reimburses this capital to the Field Partner once the recipient’s loan has been 100% funded. If the recipient’s loan is canceled for any reason, the recipient will no longer be designated as a “Wokai recipient” and that Field Partner will permanently fund the loan with its own capital reserves.

What happens if a recipient’s loan does not get 100% funded by the final fundraising day?

If a recipient’s loan is not 100% funded by the time it reaches zero “Days Left”, then Wokai will either extend the recipient’s fundraising period by one month or, if there is any specific reason why contributors are choosing not to fund the recipient, Wokai will cancel the recipient and allow contributors to select a new recipient to support.

Wokai is committed to being transparent in its processes.  To that end, we discuss our field partner relationships right on our “About” pages.  We even received credit from David Roodman in his original post for being very open about our relationships with field partners.

To read more about what Wokai does, visit their site at Wokai.org

Back in November last year I wrote about a new lending organization called United Prosperity that has a new take on microfinance lending.  United Prosperity recently launched the full version of their website, which allows its lenders to guarantee loans for entrepreneurs rather than loan money to directly the the entrepreneurs.
Here’s some more information about United Prosperity:

United Prosperity is a non-profit organization that helps you combat extreme global poverty powerfully by multiplying the impact of your money through loan guarantees. We are the world’s first person to person loan guaranteeing website.  You can become a compassionate social guarantor with United Prosperity by providing an interest-free cash collateral or guarantee for an entrepreneur on our website. No minimum amount is required, and you are able to choose which entrepreneurs you would like to support.

The biggest question that I had when I was surfing the site was why should I choose United Prosperity over other sites?  Of course, a few minutes later, I found my answer.  Here are some good examples of how United Prosperity is different:

Example A: Providing a loan to a poor entrepreneur: A poor entrepreneur needs a $1,000 loan. Ten lenders could each contribute $100 to make a loan of $1000 to the poor entrepreneur.Thus a total $1000 in contributions results in $1000 of loans made to the poor entrepreneur. On an individual basis, a $100 contribution results in a $100 loan to a poor entrepreneur.

Example B: Providing a loan guarantee to a poor entrepreneur through United Prosperity: Guarantee amounts are typically only a portion of the loan amount. For example, for a bank to lend $1000 to a poor entrepreneur, it might require a guarantee of only $200. Thus 2 social guarantors could each contribute only $100 and cover the $200 guarantee needed and thereby make a $1,000 loan available to the poor entrepreneur.Thus $200 in guarantees results in $1000 loans available to the poor entrepreneur. On an individual basis, $100 loan guarantee results in $500 of lending to a poor entrepreneur.

We maximize the impact of your dollar:
For every $1 you put toward a guarantee, you will allow nearly $2 or more in microloan to the entrepreneur from local banks either directly or through our partners. Better yet, you will be able to track your chosen entrepreneur’s progress, and when they repay their loan, you will be repaid in full! At that point you will have the opportunity to support another entrepreneur if you wish.

Although the website has a lot of information, it is easy to navigate.  United Prosperity does a really good job explaining what the benefits and risks of microfinance are but still manages to have the human touch, rather than just being a website full of information.  They have a team blog were members of the organization write updates, as well as a great community page which allows lenders (and even non-lenders) to share insight about the platform as well as microfinance in general.

I just made my first loan of $25, does anybody want to match me

Anybody and everybody who has used the internet has most likely used Craigslist at some point or another.  Founded by Craig Newmark, Craigslist is a network of online communities, including sections that cover jobs, personals, housing, forums, services, and classifieds.  This week, Craig Newmark has officially announced that he is joining the Advisory Board for LendForPeace.org . Craig has alway been a supporter of peace initiatives in the Middle East, and with his experience as being one of the pioneers of community building, he should be a great asset to LendForPeace.org and can hopefully create some great microfinance initiatives in the Middle East and within the microfinance community.
Read the entire press release here.

Congrats to the team at Wokai for landing this CNBC spot!