NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, February 5, 2014

Zidisha has launched its global direct microlending platform at the legendary tech startup incubator Y Combinator. Dubbed an “eBay for microlending”, Zidisha is the first online P2P lending platform to link individual lenders and borrowers directly across international borders.

A United States nonprofit organization, Zidisha lets ordinary web users make microloans to individuals in the world’s poorest countries. The loans allow the individuals to start small businesses to provide higher income for their families, and once repaid the loan funds are returned to lenders with interest.

Other microlending websites such as Kiva rely on local intermediary banks to manage the loans. The intermediaries pass on costs to the borrowers. The average Kiva borrower pays over 30% in interest to these intermediaries.