Fuelling lending craze for the small and medium entrepreneurs is the offering of Microlending solution from NanoBNK. The microcredit is a way to grant individuals the necessary money to expand a small business. Our platform solution is all about replacing the sales agents and the application process with user-friendly app streamlining the process and makes the costs drop significantly, creating more competitive products for a fraction of the original fee. Backed by Big Data NanoBNK Microlending solution informs the lender about the borrower’s situation and help them decide on the best course of action. Starting with an analysis of the borrower’s previous exposure to financial knowledge, the lender can create informational materials.
Social Lending Background
Microlending is the product of vital business, technological and social trends, including:
A new generation of so-called “freeformers” who couple personal freedom with social activism. Freeformers want to take control of their work and leisure. Rather than work for one company for 35 years, they prefer to collaborate in networks for short periods on various projects. Freeformers are highly suspicious of large institutions; they believe in people, not banks.
The disintermediation of almost everything. Technological change, globalization and other international trends continue to reduce the number, size and role of business intermediates in many industry sectors.
The spread of web technologies, which foster “mass collaboration.” These new tools enable individuals to work together online in huge groups to achieve mutual goals (Ebay and social networking sites like Facebook are examples).
The development of microlending to individuals with few assets in poor nations. Community- and social-minded lending entities, such as credit unions, have been around for a long time. But microlending gave impetus to the ideal of achieving social goals by making small loans to individuals.
Microfinance is a vital solution
1. Access Banks simply won’t extend loans to those with little or no assets, and generally don’t engage in the small size of loans typically associated with micro financing. Microfinancing is based on the philosophy that even small amounts of credit can help end the cycle of poverty.
2. Better loan repayment rates Microfinance tends to target women borrowers, who are statistically less likely to default on their loans than men. So these loans help empower women, and they are often safer investments for those loaning the funds.
3. Extending education Families receiving microfinancing are less likely to pull their children out of school for economic reasons.
4. Improved health and welfare Microfinancing can lead to improved access to clean water and better sanitation while also providing better access to health care.
5. Sustainability Even a small working capital loan of $100 can be enough to launch a small business in a developing country that could help the benefactor pull themselves and their family out of poverty.
6. Job creation Microfinancing can help create new employment opportunities, which has a beneficial impact on the local economy.
Microlending; Rewards for Individual Lenders
Most individual lenders choose to participate in a microlending program because they want to give back in some way. Whether it’s to help a woman launch a handicraft business in a far-reaching Asian village or the desire to support a local community, lenders should be considering microlending as a form of philanthropy as opposed to a way to turn a profit. Doing good is often the only reward in participating in a microlending program.
Many individuals are personally touched by the stories of those they help which motivate them to continue to give. It’s often amazing to realize how such a small amount of money to one person can be life-altering in a positive way to someone else. These stories often are what keep many individuals microlenders wanting to lend again and again.
On the flipside, there are some downsides that are inherent to all types of microfinancing. It’s important to first realize that there is a risk in lending money. Not all borrowers will pay back loans. You should only offer money if you can afford to lose it. Hopefully, you will be paid back in full, but if you don’t, you don’t want it to break your bank!