The principle of microcredit is to offer small loans to entrepreneurs, artisans, shopkeepers who do not have access to traditional banking system. In developping countries, €300 is the average lended amount. With these micro-loans, they are able to execute micro-projects, thus providing employment and assisting local economic development. Micro-credit is one of the services offered by Microfinance Institutions (MFIs). 

Microfinance Institutions (MFIs) are organisations that offer microfinance services and products to the poor, such as: savings and credit cooperatives, NGOs, programmes established by international organisations, legally-recognized microfinance institutions, and microfinance banks. Their sizes greatly vary, from 100 clients to over 6 million clients for the largest. As well as offering basic financial services such as loan products, savings accounts, and insurance, many MFIs also provide non-financial services such as training and education, or specific programmes to combat local issues.

To find out more about a specific MFI, please visit mixmarket.org

Online peer-to-peer (P2P) microcredit enables internet users to select micro-entrepreneurs’ projects from all around the world and finance them directly by lending money via an internet platform. MicroWorld is one of these online microcredit platforms. Internet users can then follow the progresses of their projects on line until the total repayment has been made. Online microcredit platforms provide new financial resources to Microfinance Institutions (MFIs) and also offers to new types of lenders (internet users) the opportunity to get committed to the struggle against poverty. 

To fight against poverty and help the development of local economies, MicroWorld finances entrepreneurs’ projects with interest free loans. This gesture of solidarity enable the projects to reach economic viability and sustainability.
Furthermore, 100% of the lent amounts go to helping the micro-entrepreneurs and not to financing MicroWorld’s operating expenses (see : How does MicroWorld cover its operating costs?). These amounts are then paid back to the lender once the loan has been repaid.

MicroWorld works with PlaNIS, a subsidiary of the PlaNet Finance Group specialised in financing MFIs. All the pre-selected MFIs are rigorously examined to ensure they are financially rough and that the social impact of their missions is appropriate. An investment and risk board is responsible for carrying out due diligence checks and an operational audit before validating or not a maximum amount of outstanding loans for the MFI.

No. The various micro-entrepreneurs and their projects are selected by local partners: the Microfinance Institutions (MFIs). These MFIs are all highly-reputed and firmly established with a wealth of experience in the field of microcredit. They have the expertise and resources required to assess entrepreneurs’ potential projects and the adequate infrastructures to support, train and accompany micro-entrepreneurs. It is the MFI, in agreement with MicroWorld, who selects the projects to be published on the site.

100% of the lent amount will be given to the selected micro-entrepreneur. However, since the procedure for financing a project and transferring funds can be quite lengthy, it is possible in some cases that the MFI will advance financing for the project from its own funds, so that the micro-entrepreneur doesn’t have to wait. When the MFI receives the funds sent by the MicroWorld lenders, it is then in a position to free up the funds it had advanced and invest them in a new project. This refinancing technique is similar to making a purchase on a credit card – when you purchase goods, the credit card company advances the money to the retailer on the understanding that it will recuperate the amount from your account. Here, the MFI advances the loan to the borrower and the advance is then reimbursed to the MFI via the MicroWorld lenders. 

Yes, micro-entrepreneurs pay interest on the sums borrowed from MFIs. One of the principal objectives of micro-financing is to create a model of sustainable development. In this way, all the participants in the chain must be able to cover their costs and develop their activity on a long-term basis.
The MFIs bears the significant operating and refinancing costs which have to be covered, resulting in interest rates which are often equivalent to 3% per month rather than per year (i.e an average of 27 % per year)! This may seem very high when compared to the rates charged by banks in developed countries, but this comparison is misleading because the economic context is very different, even if, as in all sectors, there are cases of abuse which must be tackled. Besides the frequent, serious follow-up of the borrowers’ investments, as well as the high number of clients increase the costs.

To find out more

As for any loan, there is a risk of non repayment of which you must be aware when deciding to lend. However, with MicroWorld, in the case of non repayment by the micro-entrepreneur, the MFI partner takes the place of the borrower to repay the loan.

Then remains the risk of bankruptcy on the part of the MFI. In order to limit this risk, MicroWorld has created meticulous procedures and established strict criteria for entering into a relationship with an MFI and relies on the expertise of PlaNet Finance’s investment specialist, PlaNIS.
With PLaNIS, detailed financial and operational audits are conducted on all MFI partners before they are accepted. MicroWorld then regularly monitor the financial soundness of the MFIs to anticipate risk. However, it is important to note that the MFIs partners are located in countries where the economic and political environment is often fragile or where the risks may be significant. To read more on the subject, see “Risk Management”.

The micro-entrepreneur repays his loan according to a precise schedule established with the MFI. When all the repayments have been completed, the MFI transfers the funds to MicroWorld who then makes the amount available to the lenders. The transfer of the funds from the MFI to MicroWorld is made in one single payment to limit the number of money transfers and to guarantee the partner MFI a minimum level of stability with regard to its outstanding liabilities.

MicroWorld receives a commission of around 5% from its partner MFIs in exchange for publishing its projects on the website. This costs remains for the MFI lower than the normal cost of financing, which means it can access capital at an improved rate.
MicroWorld is also remunerated by its corporate partners for the organisation of dedicated spaces and for visibility on the website.
Finally, MicroWorld is also supported by the private investors who have made a commitment to financing its activity until it reaches breakeven. More information on MicroWorld partners

When you create an account on MicroWorld platform, you become a member of the MicroWorld community. This is the first necessary step to lend to micro entrepreneurs and take part in events organised by the community. You can choose to belong to the PPR Community, which gatheres all lending PPR employees.

Once you have set up an account, you can select the micro entrepreneurs you want to support, follow your loans on line and associate your colleagues with your projects to encourage them to become lenders themselves. 

Go to the PPR Foundation dedicated page, www.microworld.org/en/partners/fondation-ppr  and click on “Create an account” at the top right of the page. The information you will be asked to provide is: a valid e-mail address, a user name or screen name, which will be visible on the site, and a password. Do not hesitate to add a picture!
A confirmation e-mail will be sent confirming your registration : click on the link to activate your account. Before you confirm your first loan, you are also required to complete your profile and provide the following information: name, first name, address, date of birth.

1. Please connect to your personnal account

2. Choose a project

To lend to a project supported by the PPR Foundation: go to the PPR Foundation dedicated page, www.microworld.org/en/partners/fondation-ppr , click on the right on « PPR Foundation’s projects ». It presents all Foundation’s supported projects. Those which are not totally financed and still open to lending are identified by a red line with notification « Add to my selection ».

To find out more about a borrower, click on his/her photo. There you will find information about the related country and its economic context, the borrower and the terms of the loan.

PPR Foundation supports projets empowering women, in PPR countries of operation, that is currently Peru and Cambodia.

To lend to another project proposed on the plateform , click on « See projects » on the main menu, at the top of the page : you can search by country, activity, status (pending funding or repayment) and beneficiary.

3. Select the projects to be supported

Next, select your project and click on the “Add to my selection” button below the project description. On this page, you can also select the amount you wish to lend, with a minimum of €20. Then click on the “Lend” button to add the loan to your basket.

You can select several projects by clicking on them one at a time

4. Confirm your loans

To view the loans you have chosen, click on “My selection” in the top right hand corner of any page on the site. You can review your chosen projects and change the amounts you wish to lend by clicking on “Recalculate”. This will update the total amount you are financing.

Confirm your loans by clicking on “Finalize my investment”.
You can then either use the funds available in your MicroWorld account to finance these projects or transfer money into your account with a bank card or (via a PayPal account if you have one).

NB: Funding is accepted in multiples of €20. You can therefore invest €20, 40, 60, 80 etc, with a minimum requirement of €20.

5. As soon as the loan is confirmed, you receive a confirmation e-mail, with the contract between you and the MFI.

In the main menu at the top of the page, click on the “My MicroWorld” section to view the history of your loan portfolio and the balance remaining in your MicroWorld account. On this page, you can also view your personal profile, investment profile and keep in contact with the PPR community on MicroWorld.

Once a project has been funded, the MicroWorld website allows you to follow its developments on a monthly basis. During the loan period, the entrepreneurs proceed to regular repayments. MicroWorld receives monthly updates on the repayment status of each loan, and displays this information on for lenders to see.

The green dots mean that the entrepreneur’s repayments are on-time and up-to-date for a given month. The most recent dot indicates the current status of the entrepreneur. Therefore, even in the case of repayment delays in previous months (marked with a red dot), a green dot in the latest month indicates that the entrepreneur is now up-to-date on their loan repayment.

Click on “My MicroWorld” in the main menu and then click on “My Investments”. Depending on the balance in your account you may withdraw money from your MicroWorld account and transfer it to a PayPal account previously set up in your name. To do this, enter the e-mail address of your PayPal account, choose the amount you wish to be reimbursed (which must be less or equal to the balance available on your account) and click on “Register Repayment” to validate.

When the loans you have made reach the end of their term, MicroWorld credits your MyMicroWorld account with the amount repaid. You can lend these funds again, or request to withdraw part or all of your balance.

For security reasons, the transfer will arrive in your PayPal account within 15 days, to prevent MicroWorld from requiring your bank details. You simply need to specify the e-mail address associated with the PayPal account on which you wish to receive the funds. If you do not have a PayPal account, you can create one for free, and then withdraw the money from your PayPal account to your bank account.

NB: Funds used for financing a project may not be withdrawn before the loan maturity date of the project.

Several way to go to the page dedicated to the PPR Foundation:

• In the "community" part, in the main menu, please write "ppr" in the search engine, in the bottom of the page
• On the homepage, please click on the Foundation's logo, at the very bottom of the page, next to the footer menu
• if you are a member of the PPR Community, you have a direct access from MyMicroworld 
• and here is the direct address!

If you want to join to the community, please go to the dedicated page and click on "join" on the left of the page! 

See you soon on microworld.org !