Online auction giant eBay has launched a microlending Web site that lets people invest in entrepreneurs in poor communities around the world and get a return on their money.
Unlike micro-finance organizations that make interest-free loans to people in developing countries, Microplace.com offers investors profits for funding people trying to build better lives, founder Tracey Turner says.
"You are actually investing in the world's working poor," Turner said. "And for the first time you get a return on investment. You can take the profit and invest in more people in a virtuous cycle."
Turner's vision of MicroPlace began taking shape in 2005, after she lived for a time with a Kenyan family comprised of a single mother caring for three children.
The Kenyan woman bought a sewing machine with US$100 she borrowed and started an in-home business making school uniforms for local children.
The woman paid the debt and managed to send one of her sons to college in the US.
"When you are out in the field talking to these women whose lives are transformed because of US$30 or US$10, then you are part of the movement forever," Turner said.
California-based eBay bought Turner's business plan in June last year and the Web site launched on Oct. 24 this year.
Web site visitors can browse investors by country, seeing pictures of people seeking loans and reading about their business goals.
MicroPlace connects investors with micro-finance organizations in the various countries. MicroPlace scrutinizes the organizations to check their legitimacy.
"Our job is to vet," Turner said. "We do a lot of research."
Turner said the rates of return are modest but that investors at the Web site see value in addressing global poverty. Lenders shoulder the risk that their loans will not be repaid.
"The eye-opening thing for everyone is that repayment rates by the working poor remain unbelievably high, north of 98 percent," Turner said.
Thousands of people visit the Web site daily and hundreds of thousands of dollars in loans have already been issued, MicroPlace said. In keeping with the holidays, some have made gifts of loans by issuing in others' names.
"What gets me out of bed in the morning is the idea that when you invest in a person it really honors them and enhances their dignity as a human being," Turner said. "Which is different than a handout."
MicroPlace gets fees from microfinance organizations that get money through the Web site. Money is moved through online financial transactions firm PayPal, which eBay owns.
"I think it is important everyone from the investor to the person making baskets in a village makes a profit," Turner said. "The beauty and magic of micro-finance is that it is scalable. That is the only way it will scale."
EBay has promised that any profits made by MicroPlace will be invested in other initiatives for social good, Turner said.
EBay founder Pierre Omidyar and his wife have channeled hundreds of millions of dollars into microloans through their own foundation and are investors in online microlending Web site Kiva.
"The industry is growing like crazy right now," Turner said. "It is a new kind of asset class. It is a wise investment."
NO-LIMITS PARTNERSHIP: ‘The bottom line’ is that if the US were to have a conflict with China or Russia it would likely open up a second front with the other, a US senator said Beijing and Moscow could cooperate in a conflict over Taiwan, the top US intelligence chief told the US Senate this week. “We see China and Russia, for the first time, exercising together in relation to Taiwan and recognizing that this is a place where China definitely wants Russia to be working with them, and we see no reason why they wouldn’t,” US Director of National Intelligence Avril Haines told a US Senate Committee on Armed Services hearing on Thursday. US Senator Mike Rounds asked Haines about such a potential scenario. He also asked US Defense Intelligence Agency Director Lieutenant General Jeffrey Kruse
China’s intrusive and territorial claims in the Indo-Pacific region are “illegal, coercive, aggressive and deceptive,” new US Indo-Pacific Commander Admiral Samuel Paparo said on Friday, adding that he would continue working with allies and partners to keep the area free and open. Paparo made the remarks at a change-of-command ceremony at Joint Base Pearl Harbor-Hickam in Hawaii, where he took over the command from Admiral John Aquilino. “Our world faces a complex problem set in the troubling actions of the People’s Republic of China [PRC] and its rapid buildup of forces. We must be ready to answer the PRC’s increasingly intrusive and
INSPIRING: Taiwan has been a model in the Asia-Pacific region with its democratic transition, free and fair elections and open society, the vice president-elect said Taiwan can play a leadership role in the Asia-Pacific region, vice president-elect Hsiao Bi-khim (蕭美琴) told a forum in Taipei yesterday, highlighting the nation’s resilience in the face of geopolitical challenges. “Not only can Taiwan help, but Taiwan can lead ... not only can Taiwan play a leadership role, but Taiwan’s leadership is important to the world,” Hsiao told the annual forum hosted by the Center for Asia-Pacific Resilience and Innovation think tank. Hsiao thanked Taiwan’s international friends for their long-term support, citing the example of US President Joe Biden last month signing into law a bill to provide aid to Taiwan,
UNWAVERING: Paraguay remains steadfast in its support of Taiwan, but is facing growing pressure at home and abroad to switch recognition to Beijing, Pena said Paraguayan President Santiago Pena has pledged to continue enhancing cooperation with Taiwan, as he and Japanese Prime Minister Fumio Kishida expressed opposition to any unilateral change to the “status quo” in the Taiwan Strait using force, Japanese media reported on Saturday. Kishida yesterday completed a trip to France, Brazil and Paraguay, his first visit to South America since taking office in 2021. After the Japanese leader and Pena spoke for more than an hour on Friday, exchanging views on the situation in East Asia in the face of China’s increasing military pressure on Taiwan, they affirmed that “unilateral attempts to change the