Micro Lending – Invest for Good

Micro Lending has been around here sometime now. It aim at providing small loans to the poor to help them run a business. These loans are usually very small amounts, around 25-100 USD to the poor in developing nations. The problem is that it is usually difficult for an individual to be a part of micro finance.

Microplace is an initiative from eBay and helps you as an investor to connect with institutions that are in micro finance. You can invest as little at $25, but have an overall impact on helping someone. Do note most micro lending institutions will provide loans at interest rates of around (20-30%), but the highest interest rate listed in MicroPlace is around 6%. This is still way above what you can get with a CD in a bank. The big difference is that these are unsecure loans and you can loose money. (I have been using MP for the past 6+months and have not lost anything yet)

This is not the place to look for wealth building, but is something that I thing everyone should have as a part of their portfolio. This is a kind of Charity, but without having to give your money away.

Good for you, and good for your money too!!

Note: MicroPlace is currently available only to residents of USA

Technorati Tags: MicroLending,MicroPlace,MicroFinance

Comments

[Santhanam]

Dear Anand,

It is a nice post as like your other posts.

For Micro Lending specific to India, www.dhanax.com seems to be a good one. Also also another one at http://www.rangde.org.

With Regards
Santhanam

[Anand Mukundan]

Thanks Santhanam. I have been looking into these sites. Pls read my newer post http://www.personalfinideas.com/2009/03/micro-lending-in-india.html for my current thoughts about these.