Today we kicked off our morning with an energetic and informative conversation with Tracey Turner, founder of MicroPlace. We’d like to take moment and briefly focus the spotlight on the awesome work they’re doing.
If you’re not familiar with MicroPlace, you can think of it as having a similar model to Kiva with one distinct operational difference: they offer an interest on all loans invested. Unlike Kiva which allows you to make micro loans to poor entrepreneurs around the world with zero interest, MicroPlace allows you to the same thing with interest rates ranging from 0.5%-6%.
Tracey and her team operates with a philosophy that a financial return on investment enables more individuals to participate in doing good because of the financial incentive and additionally it creates a sense of accountability and empowerment for borrowers who must repay their loans with a minimal interest charge. An interesting statistic Tracey shared which entirely supports the notion of microplace offering more of a business transaction instead of a charitable transaction (such as Kiva) is that the median US household has $1000 to donate but $50,000 to invest. Quite a dramatic and notable difference and of course a compelling reason for seeking social investment instead of charitable donations.
Another reason we think MicroPlace is pretty great, from the standpoint of sustainability; to ensure we lend a hand to those at the bottom of the pyramid, a return on investment is evidently more sustainable than a donation. Via investment, we invest, do good, earn a return and can repeat that entire process (with a high level of accountability for the borrower). With a donation, we give, do good and may or may not have the ability to give again in the future and the level of accountability for the borrower is negligible.
We wish MicroPlace many successes in the future as they move towards becoming a proven sustainable model.
MicroPlace
MicroPlace is an online platform which connects lenders in the United States to entrepreneurs in developing countries. Their goal is to alleviate poverty by offering interest for lenders thereby gaining mainstream appeal.
- Website: www.microplace.com
- Founder(s):Tracey Pettengill Turner
- Founded: 2005
- Location:San Francisco, US
Contributor Profile: Erik
Erik is a perpetually curious social innovator. As a serial entrepreneur, Erik knows a thing or two about change. As a co-founder of SocialEarth, Erik hopes to channel his passion for social advocacy into an innovative venue of social awareness for others. Website: SocialEarth
Twitter: @erikeliason
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