Have you ever thought about donating money to someone anonymously? What if I told you there was a better way to give money anonymously and change someone’s life forever? What if your small donation could end up funding a global development project?
It is ideally what microfinancing is set up for; to provide financial assistance through small low-interest loans to individuals and SMEs who would otherwise not qualify for traditional bank loans. A report on This is MONEY shows that more than 50% of UK startups with less than 50 employees were rejected for bank loans. More so, 37% of SMEs are likely to give up their search for loans after their first approach is rejected.
What is the challenge facing most startups?
In the last few years, there has been a surge in micro-financing institutions. Their main aim is to facilitate microloans to those who need it the most – the SMEs. Business startups suffer from lack of funding which is why most of them don’t stay in business for longer than five years.
More so, these SMEs are unable to secure bank loans because they don’t have a credit history. The much-needed boost could come in the form of microloans which can easily be secured from reliable micro-financing institutions.
Microloans extend a helping hand
By definition, a microloan is a very small loan usually in the ranges of $5-$35,000. It is offered at a low interest rate to a self-employed individual as a personal loan or to startups as a business loan.
Microfinancing is a 40-year old industry and its already making a real impact with the success story of Grameen Bank which was established in Bangladesh in 1976. Most of the successful micro-financing institutions are geared towards creating social and economic development for the people living in underdeveloped countries through favorable lending terms.
Microloans have a simple loaning process and on innovative platforms such as AssetStream, the lender and the borrower meet through a decentralized platform. The loan repayment period is friendly, and there is the lowest risk of defaulters.
While banks require collateral and high-interest rates, microfinancing for startups is heaven-sent for many reasons:
- Provision of microloans to people with no credit history
- Low-interest rates
- Small loans that are easily secured at any time and place
- Supports the unbanked population by providing financial inclusion to more than 2 billion adults worldwide
- Low loan processing fees
- Loans requested by startups are usually too small for large banking institutions to deliver efficiently
Innovative micro-financing for startups
The advantages of turning to micro-financing couldn’t get better. Microfinancing is bringing P2P lending right in your pocket.
We are talking about projects like AssetStream – a platform where startups looking for loans can meet lenders and receive funding for their projects at very low-interest rates quickly and securely.
Innovative micro-financing integrates blockchain technology which makes AssetStream an effective peer-to-peer lending platform. More so, P2P lending offers fascinating applications such as mortgages, student loans and consumer credit among others.
The AssetStream project is ideal for anyone thinking of funding their startup. It involves, a local agency which follows up on the borrower (including authentication and verification and in extreme cases pursuing legal action on defaulters), a lender whose finances are used to provide microloans to SMEs for business purpose and borrowers.
Off to the better future
AssetStream was created to provide an extensive system to facilitate the issuance and repayment of micro-loans through a micro-financing ecosystem that raises awareness through consulting and educative material. Why should you wait for months to get the funding you could get within days on AssetStream? Join now as a borrower and steer your startup to success.