To provide a micro lending service that offers fair interest rates to investors and borrowers.

We started this business after realizing that most Filipinos rely on micro credit services due to a lack of feasible alternatives, yet they pay exploitatively high interest rates to participate. It was clear to us that there was room for an alternative that charged much lower rates while remaining feasible for investors — especially when you consider that Western investors face annual interest rates close to zero if they keep their money in local bank accounts. 

We connect both parties together.

Currently, we only issue micro loans in the Philippines. We’re very familiar with the country and have been operating there since 2016. 

However, borrowers in many other countries face a similar situation to Filipinos (high interest rates for micro loans), so we may extend our services further in the future.

Unfortunately, we’re not able to take on investors at the moment. However, we’re in the process of opening up to the public, so please sign up for updates if you’d like to be notified when this changes.

The following testimonial is an unedited original and therefore contains some "creative spelling and grammar". Only the name was removed for privacy reasons.

                              A message of Thanks and Gratitude!

Dear Ms. xxxxxxxxx and  Associates!

Hi mam! Thank you very much for the help and assistance extended by you and your associates/partners  thru your Financial  Firm.

First, your office greatly help our small business which has been our means of livelihood for the last five (5) years.

Summing up your help, and your firms' commitment in helping the small and medium scale business folks, last March our daughter finally graduated (BS Medtech) at the Iloilo Doctor's College (IDC) in Molo, Iloilo City.

She is now preparing for the September MedTech Board Exam.

If not for your firms' help, I know that she will never be able to get hold of her diploma!

Further, I hope your office will continue the simple, yet direct and fast approaches to financial solutions besetting small businessmen, specially the start-up store or medium scale business folks like us who are often victims of "Loan Sharks Capitalist" having/charging  mammoth interest in their financing loan terms.

Truly, your firms commitment to help small time businessmen like us, is very commendable. Unlike other financial institutions that has requirements which are very difficult to process or be submitted, for instance rather than submitting a Department of Trade and Industry or (DTI) Permit, your office just require a Barangay Business Permit which is very accessible to secure, especially for folks living in the remote Barangays.

Barangay and Police Clearances are already Okay with your firms, unlike some financial institutions and even government banking arms which require NBI clearance and two valid government ID's.

These two (2) government ID's such as SSS and LTO cards are too "difficult" to be produced  by simple folks living a simple lives in far flung Barangays...

Yet, thanks to you mam Charina and to your associates, with your firm's help, my daughter can later on work and also help us.

Finally mam, my personal thanks also.

Without your firms' help last year,  I may not be working here in Makati City, since it was your office which in a way "financed" my going here in Manila while applying for work.

 I am currently Asset Protection Consultant in a Risk Assessment Solution Firm here in Makati CIty.

Hooray and maraming salamat po!

We’re based in the Philippines, which is where we service our borrowers. If you’d like to visit us or get in contact, please use the following address:

Gran Plains Subdivision
Phase 3
Iloilo City 5000
Philippines

We use reputation as collateral by putting borrowers in Facebook groups, where they can see each others’ payment activity. The public nature of this format gives them an incentive to keep up with their loan obligations — and Facebook is the perfect tool for the job since it has a de facto monopoly on online communication.

Typically, micro loan borrowers are unable to secure their loans with traditional collateral, such as titles or mortgageable valuables. Yet most banks (as well as internet-based or fintech lending platforms) make such collateral a prerequisite to lending.

Therefore, many people are excluded from borrowing despite being able to repay the money they borrow. Rethinking this traditional approach to collateral has the power to help a lot of people and boost economic growth while also benefiting investors.

New borrowers join crowd.investments after being referred by an existing borrower. Therefore, crowd.investments can use the local knowledge and social relations of existing borrowers to find reliable new borrowers.

Growing the customer base through recommendations from existing borrowers has many advantages. As well as growth, it also paves the way to reduce default rates.

We monitor repayment behavior, which gives each borrower a reputation rating. Recommenders can increase their reputation through successful referrals, which also gives them additional privileges, like lower loan rates. The reputation system also links the referrer’s reputation to the reputation of the person they recommended. If the referred borrower defaults, their reputation goes to zero and they cannot get another loan. The person who recommended them also ends up with a lower reputation and loses their privileges.

This gives borrowers important incentives to repay promptly — and to support the borrowers they referred. crowd.investments therefore uses local and social information, personal ties within communities, peer support, and (if necessary) peer pressure to grow and to minimize defaults.

Most of our micro loans are used for the following purposes:

• Purchasing goods for small enterprises
• Founding small enterprises
• Education
• Health care costs
• Seafarers

However, some borrowers may differ from this somewhat.

In the Philippines, parents need to pay tuition fees for their children three to four times per year. On top of this, they must pay for school uniforms, books, school projects, etc. Frequently, they end up unable to come up with the whole amount at once — and since parents do not want to let their children drop out of school, they often borrow the money and pay it back during the school term.

Education is a crucial long-term investment, so we like to support these parents with loans. The capability of the parents to repay might not be as clear as it is with business owners, but we do not want to focus only on maximizing income. We want to help people to improve their situations too.

Many Filipinos are seafarers, and we’re happy to be able to offer them a solution to one of the biggest problems they face: The need to bridge time between sea voyages. 

Shipping companies usually only allow seafarers to stay on a ship for six to ten months before they need to take a break, meaning they’re are left without income for months at a time. Micro loans keep seafarers going throughout this period, and they can use the cash advance from their next voyage to repay the loan.

We also offer micro loans to seafarers that need to pay for training courses to advance to a higher position on their ship.

Micro lending institutions like Card Bank, Taytay sa Kauswagan, Exquisite Lending, or Marayo Bank make micro credits more accessible to small and medium enterprises (SME). Their interest rates are much lower than those available in the informal money lending market.

They enable many SMEs to get into and stay in business. Typically, they demand daily or weekly repayments; failure or delay of even one installment frequently excludes a borrower from getting another loan.

Micro lending usually involves weekly meetings with obligatory attendance of all borrowers from a certain region. At these meetings, borrowers make repayments, discuss their situation, or learn more about doing business and managing their finances. Many of them find this helpful, and default rates are very low.

However, a lot of borrowers struggle with daily or weekly payments if their revenues follow another pattern (e.g., farmers) or need a longer time to repay. Seasonal businesses have a particularly tough time.

In other cases, they may be unable to spend half a day (including traveling time) to attend meetings. For some, weekly travel costs and lost time render this endeavor unprofitable. The meetings usually are held on workdays during business hours, so participants lose half a day of income.

This leads to a situation where more successful business people tend not to borrow from micro lending institutions, because it costs them too much time and therefore revenue. Meanwhile, the less successful have little to lose and borrow from them.

Plus, many micro lending institutions do not pay out the full loan amount. They deduct substantial handling and attorneys fees (even if no attorney is needed) and subtract the first installments or interest ahead of payments. If there are public holidays during the credit period, meaning there are no weekly meetings, they deduct the installments due on these holidays from the paid-out loans.

Most local banks issue loans only to account holders. This excludes around 70% of the Filipinos, as they have no bank account. Those with bank accounts can only get loans if they can offer collateral and a cosigner, which most can't. And if they have collateral, they must undergo an often months-long application process. High processing fees are then charged and deducted from the loan payment.

We asked many of our customers if they had approached a bank for a loan before approaching us, and it turned out that they usually never even considered doing so for the above-mentioned reasons.

The informal money lending market is dominated by lenders from India and returning overseas workers. As most Filipinos have no other source for loans the informal lenders can dictate the conditions. Therefore monthly interest rates usually range between 10% and 20%. High processing fees are frequently charged on top of this.

Most Indian lenders insist on daily repayments. This is not feasible for businesses without daily revenues like rice farmers. Even market vendors who have daily revenues find it difficult sometimes, because there are peak days and less busy days. And the lenders often demand the payments in the morning before the vendors have sufficient earnings.

Frequently informal money lenders misuse their power by forcing the borrowers into unfavorable dealings. Many owners of small businesses depend on lenders because they can only afford to buy their goods with their help. After deepening this dependency by giving several loans, suddenly the next loan is only paid out if the borrower buys some overpriced piece of equipment like a fridge from the lender first.

Local knowledge often alerts people about potential business opportunities, but they often can’t afford to embrace them. One of our borrowers knew of a relative who would retire and thus give up a vegetable stand in the local market. Another knew of a friend who would sell his tricycle. And a third borrower knew that the Barangay (an administrative division in the Philippines) was about to rent out a shop that is ideally located to open a mini-store. They all wanted to use these opportunities to create an income, but could not come up with the funds to do so. All three of them and many more could embrace the opportunity and open their small businesses with loans from crowd.investments.

Other business owners want to embrace seasonal opportunities like Christmas sales or the harvest of certain fruits like rambutan, mangoes, mangosteen, or water melons. Some want to take advantage of periodical fluctuations in the price of rice, etc. To make use of such occasions they needed to make a large investment when the fruit is harvested, the rice price is low, or before a feast day. Only a loan enables them to create this seasonal income.

Businesses need equipment to operate. It needs to be acquired upfront and to be replaced from time to time. Some of our borrowers run frozen goods businesses, for which they must acquire cooling devices. Cookshops need cooking equipment, tricycle drivers tricycles — you get the picture.

Some business owners are simply too poor to buy their stock without loans. We talked to a lady who does not have the money to buy a bundle of bananas in the morning to fry and sell them at the local bus station. She takes a loan, buys the bananas, prepares and sells them, and repays the loan. This way, she makes her daily living.

De facto, no functioning health insurance available will cover the financial risks of illness. Phil Health only pays for certain extra costs when the insuree is hospitalized, and the treatment itself must still be paid by the insuree. Patients without money are not treated, no matter how serious their situation is.

We know of a case where a pregnant woman who was about to give birth to twins was rejected by three hospitals because she had no money. She died giving birth, while the twins survived and became half orphans. The father was unable to cope with the situation and had to give one of the twins up for adoption. Unfortunately, we only learned about the case after this had happened.

In another case, an elderly lady was about to lose her eyesight because she did not have the money to afford a cataract operation. crowd.investments gave her a loan, and after her operation, she can see well again and is therefore able to work in the mini-store of her daughter (where she earns the money to repay her loan).

To help people handle critical health issues and avoid such dire situations, we give loans for health expenses (although in some cases they are more difficult to retrieve than business loans).

Most people who need small loans do not have physical collateral to secure them. Some have a small number of valuables and try their luck in one of the numerous pawn shops. However, this is not feasible for small businesses or for covering educational or health costs since the lending periods of pawn shops are usually too short for their needs.