Financial Institution
Invest in multiple businesses at the same time
With this type of investment, you invest in financial institutions that offer loans to several Micro, Small, and Medium-Sized Enterprises (MSMEs) in emerging markets at the same time.
Your investments in financial institutions through Lendahand come with a layer of protection. The financial institutions cover most of the risk of defaults and currency fluctuations, and you automatically diversify your investment between multiple SME entrepreneurs.
Investing in a financial institution is rewarded with an interest rate between 4% - 7%. The credit score of these loans is between A and B (on a scale of A to E) and the historical write-off percentage since 2013 for this type of investment is 0.37%.
Lendahand carefully selects impact-minded Financial Institutions (FI) that seek funding to ensure local entrepreneurs receive a fair loan. Our network comprises:
- Microfinance Institutions (MFIs): committed to assisting typically poor households and small entrepreneurs.
- Digital Lending Platforms (DLPs): enabling medium-sized enterprises in emerging markets to grow and create local jobs.
- Interest rates between 4% - 7% annually
- Risks like currency fluctuations are typically covered. Defaults as well, depending on the reserves of the financial institution.
- Your investment strengthens several entrepreneurs at the same time.
Business
Invest in a single business
With this type of investment, you directly invest in a privately owned for-profit business in an emerging market. You will primarily have the opportunity to invest in impactful companies active in the clean energy and agricultural sectors.
Lendahand only selects businesses that match our stringent financial criteria. However, with this type of investment, default risks are not covered, as there is no intermediary between you and the business.
Investing in a business is rewarded with an interest rate between 5% - 9%. The credit score of these loans is B or C (on a scale of A to E), and the historical write-off percentage since 2013 for this type of investment is around 5%.
The companies we select for our crowdfunding platform must demonstrate that they make a significant contribution to the UN’s Sustainable Development Goals (SDGs). Through Lendahand, these impactful businesses can access financing at a lower interest rate than typically available. The impact you are creating is higher and more direct compared to the previous investment type.
- Interest rates between 5% - 9% annually
- Your investment provides families and enterprises in emerging markets with basic needs such as (clean) energy and makes a substantial contribution to the reduction of CO2.
- Businesses in the agricultural sector contribute significantly to providing food security in developing countries.
Small Business Loan
Lend at 0% interest
Are you looking to expand your impact even more? You have the opportunity to directly provide impact-only loans to small businesses in emerging markets. The selected, impactful companies often fall through the financing cracks in their own country and miss the economic capacity to cover loan costs. By not paying you an interest fee on their loan, Lendahand keeps the loan cost at a minimum. It allows these small businesses to fully focus on their growth.
Note that these high-impact loans carry a significantly higher risk. Interest rates for these types of loans are 0%. The credit score is C or D (on a scale of A to E). The historical write-off percentage for this type of investment is around 9%.
- Create a high impact for local companies in developing countries.
- Contribute to creating new jobs.
- Fill in the funding gap for businesses that are often overlooked.