eBay has launched a website to provide an easy way for everyday people to invest in the world’s working poor by leveraging the power of microfinance, a proven solution to alleviate global poverty.
MicroPlace.com’s unique business model creates a self-sustaining marketplace that can serve as an efficient and scalable way for capital to flow into the microfinance industry.
During the website’s launch yesterday, 150 people purchased investments on the website.
Calvert Foundation was selected as the first issuer to sell investments on MicroPlace, as well as an early partner in the development of the new venture. “In the 1980s, we were working hard to demonstrate that microfinance could be operated in a sustainable manner, and in the 1990s, the focus shifted to how to grow it to scale,” said Shari Berenbach, Calvert Foundation’s Executive Director. “Now we are looking at how to bring microfinance into the mainstream.”
Calvert Foundation will use the funds generated from the sale of securities on MicroPlace to invest in microfinance institutions that investors select from the online options. It will also be responsible for making interest and principal payments to investors.
Microcredit, currently the most well-known product within microfinance, is the extension of small loans (often less than $100) to people too poor to qualify for traditional bank loans or other forms of credit. In contrast to charity, these small loans enable the working poor to lift themselves out of poverty through their own hard work and entrepreneurial spirit.
Started in 1974, microfinance is now a proven solution to global poverty worldwide: more than 100 million people from dozens of countries have borrowed microfinance loans, and they consistently repay at rates of more than 97 percent. The idea that the working poor can lift themselves out of poverty with dignity appeals to people of all political, social and economic backgrounds.
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