Questions & Answers
Microfinance refers to the provision of financial services to poor or low-income clients, including consumers and the self-employed. The term also refers to the practice of sustainably delivering those services. More broadly, it refers to a movement that envisions a world in which as many poor and near-poor households as possible have permanent access to an appropriate range of high quality financial services.
No, Microchalice.org does not charge any interest or fees to our Field Partners.
Lending at Microchalice.org involves risk and Microchalice.org does not guarantee lenders that their loans will be repaid. By lending to multiple entrepreneurs, rather than simply lending to one entrepreneur, you may be able to increase the likelihood of repayment. We call this "loan diversification".
Yes, in fact, there are two. The first is Microchalice.org. When you lend through Microchalice.org's website, the funds are sent to Microchalice.org via PayPal. From Microchalice.org the funds are sent to the second middle man, our Field Partner, who will manage the loan including distributing funds and collecting repayments. When the Field Partner receives the funds, they are then distributed to the entrepreneur.
Our Field Partners choose the entrepreneurs whose business loans are posted on our website. Each Field Partner uses their own application vetting process, reviewed by Microchalice.org to confirm that the organization has the ability to handle Microchalice.org‘s funds responsibly. This ensures that your loan funds are actually going to genuine entrepreneurs who will use the loan for the purpose they specified. Each business loan is reviewed by Microchalice.org before going live to the site to ensure appropriate content. Microchalice.org does not send loan funds directly to the entrepreneurs. Each loan is managed by a microfinance institution that we partner with and that administers the loan funds.
Loan funds received by Microchalice.org are forwarded to the respective Field Partner on a monthly basis. The Field Partner then distributes the funds to the entrepreneur. Some of our Field Partners have working capital, which they forward to an entrepreneur when they see the business has been fully funded online, before the payment arrives from Microchalice.org. This allows the business to start operating sooner.
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Microchalice.org’s repayment system is designed to accurately reflect the way that our Field Partners collect funds from the entrepreneurs that you’ve supported with loans. When one of Microchalice.org’s Field Partners sends an entrepreneur’s loan request to Microchalice.org, they set the anticipated repayment dates for the loan and the date that the loan is set to be disbursed to the entrepreneur. This repayment schedule can be monthly, quarterly, once at the end of the loan term, or whatever most accurately reflects the way that the entrepreneur will be making repayments.
No, loans made through the Microchalice.org website do not earn any interest. Microchalice.org’s loans are not an investment and are not recommended as an investment.
No, a Microchalice.org loan is not considered a donation because it is possible you will receive your money back. Microchalice.org cannot assure, however, that your loan will be repaid or that you will recover any of your principal.
Each time a repayment is made on your loan, you will receive an email notifying you that funds were deposited into your Paypal account. |