How it works
1. Choose an entrepreneur
A small or a big loan? Choose an amount that suits you best: investing with Lendahand starts at €50. For each project the term of the loan is indicated, as well as how much interest you will receive on an annual basis and through which local partner the loan is made. With who are you doing business? You actually provide a loan to a solid financial institution in the country of origin of the entrepreneur you select. We have selected these parties very carefully based on criteria including social and financial criteria.
These local partner then provide this loan to the entrepreneur and thereby cover the risk of currency fluctuations and default. Therefore, there is no risk on your individual loan, since the local partner absorbs the risks involved. If you are providing more than one loan it is always advised to spread this investment among different local partners and countries.
2. Provide a loan
Once you have chosen your entrepreneur, you select the amount you wish to invest and pay via iDeal. There are no costs associated with providing a loan. Very soon, you will also be able to pay with credit card. (note: here there are costs involved). You will then receive an email confirming the payment.
Naturally we will keep you informed of the company you have chosen to finance. As soon as there are enough lenders to complete the loan, the money is wired to the local partner on the first day of the following month. Your interest starts on this date as well. As soon as the project you have selected has been fully funded you will receive an overview of your loan and the repayments you can expect, including interest.
3. Create impact
With any business, access to capital is a prerequisite for further growth and development. For instance, to purchase raw materials, machines or solar panels. Getting a loan is often impossible for small and medium sized enterprises in the countries Lendahand operates in. Or simply too expensive.
Therefore, you can provide these entrepreneurs with a loan through our platform. That way they get affordable credit making it possible for their businesses to grow. This leads to the creation of jobs and an increase in revenue, and ultimately the poorest are able to benefit. You can make a big difference. With your loan people are able to improve their own living conditions and the conditions of their environment.
4. Get your money back
The entrepreneur repays the loan to the local partner. The financial institution then pays the loan back to you in equal parts every six months. If the loan has a maturity of one year, you will receive a similar amount twice, plus interest. The interest is paid over the outstanding amount. You can choose to re-lend your money and in turnn help more entrepreneurs grow and receive more interest. There are no costs associated with the repayments or re-lending.
Note: We recommend that you only invest a responsible amount of your capital in crowdfunding (The dutch financial regulatory body AFM advices to invest a maximum of 10 per cent of your investable assets and not to make any investments with borrowed money.)