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Microfinance is both innovative and charitable – more SMEs should try it

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Lendwithcare is an initiative of poverty-fighting charity CARE International UK and works in 11 developing countries to provide loans to people who need them most.

Described as an innovative way of helping some of the world’s poorest people with entrepreneurial potential work themselves out of poverty, Lendwithcare boasts almost 50,000 users. On top of that, they’ve lent £19.3 million to over 89,000 entrepreneurs.

We talk to volunteer Isabel Craven to find out what makes the brand so disruptive in the microfinance market.

Who is Lendwithcare targeting?

Lendwithcare is dedicated to helping the poorest members of society. Many entrepreneurs applying for their first loan struggle to feed their families, pay health insurance or even medical bills. These entrepreneurs cannot spare the amount of money it can take to start or expand a business.

How does it work?

You can choose which entrepreneur you want to lend money to. Each profile comes with a photo of the entrepreneur and a background of their business to help you decide. Once the loan has been repaid, you can choose to reinvest your money into supporting another poor entrepreneur or withdraw your money.

The entrepreneur requests a loan from a microfinance organisation we are partnered with. Loan requests are checked and approved by the team who then post them on the website. Lenders then choose who they want to lend to and how much they want to lend.

Repayments to lenders are paid monthly or more flexibly depending on what best suits the needs of the entrepreneur. Once a lender starts receiving repayments they can choose to re-lend their money, support another entrepreneur, or even withdraw it.

How do you manage your due diligence when it comes to approving loans?

We screen each loan featured on the website to ensure the entrepreneur’s business is socially responsible, ethical and environmentally sustainable. We reject loans to businesses that cause environmental damage or are involved in poor animal welfare.

Every microfinance institution we partner with goes through a rigorous selection process involving in-depth desk research and in-country evaluation visits. Only partnering with organisations that have a focus on improving the lives of the poor, our microfinance partners must also adhere to CARE’s conduct in microfinance, which commits to protecting the rights of entrepreneurs whilst providing them with the high-quality products and services.

How direct is the impact on the individual?

100% of the money loaned through Lendwithcare goes to the entrepreneur. Not only do you know who you are lending your money to, you can be confident that they will receive all of it. Lendwithcare relies on donations to continue the running of the initiative.

Many lenders also choose to become a Lendwithcare Angel and make a donation every month. By making a monthly donation, they help Lendwithcare expand into even more countries and to reach as many people as possible.

Why is microfinance the future for charity and development initiatives?

Microfinance is a more sustainable long-term approach to helping poor people. Providing entrepreneurs with a loan through Lendwithcare gives some of the world’s poorest the opportunity to break the cycle of poverty.

What kinds of businesses do you support?

Lendwithcare supports many different types of loans and businesses, including farming, furniture making and grocery stores. Typically the loans requested through Lendwithcare are to fund micro businesses but we also support larger businesses that generate local employment opportunities.

Why should SMEs be engaging with microfinance?

As established businesses, SMEs have the opportunity to lend to a small business in a developing country and see the difference it can make. Small businesses can relate to entrepreneurs – they appreciate how difficult it is to start up a business.

What makes Lendwithcare a “smart” form of microfinance?

You get to choose how much and who you want to lend to, and you can even get the money back afterwards. You are changing lives at no cost to yourself or the business. You can either choose to reinvest this money in another entrepreneur or withdraw your money.

Get involved

Lendwithcare now operates in 11 developing countries (Cambodia, Ecuador, Malawi, Pakistan, Palestinian Territories, Peru, Philippines, Rwanda, Vietnam, Zambia & Zimbabwe).

By making a loan of just £15 at https://www.lendwithcare.org you can help an entrepreneur work themselves and their family out of poverty. Gift vouchers (from £15) are available at https://www.lendwithcare.org/gift_vouchers/.

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