Launched in summer French Babyloan.org has about 1750 lenders financing peer to peer micro-loans to entrepreneurs in developing countries. I signed up yesterday when I found the service (thanks to Jean Christophe Capelli for the pointer) and helped to fund 5 loans to borrowers in Benin, Cambodia and Tajikistan. One of them is Kheav Sitha who runs a small restaurant stand at her house in Phnom Penh, Cambodia. She wants to borrow 140 Euro for 6 months.

Signing up went smoothly. I liked the user interface for selecting the loans. It features summaries of the loan detail that are shown with AJAX on the right side of the screen while moving the mouse over photos of the borrowers seeking loans on the left side. The website is in French and English, but on some points the English translation seemed to be missing. Funds are transferred in via credit card payment – I have not yet found out how they can be transferred out after the loan term ends if they are not re-lend.

Like other platforms Babyloan partners with local microfinance institutions (MFIs). The MFIs screen the borrowers and handle the payout to the borrowers – in the case of Babyloan the payout has actually taken place BEFORE the loan is placed on the platform – and the MFI takes the sum to refinance the loan.
Unlike at MyC4 lenders do not receive interest. While Kiva asks for voluntary donations to fund its operations, at Babyloan a fee of 1 Euro per 100 Euro funded is compulsory . (Minimum a lender can lend is 20 Euro).

Babyloan is backed by Acted (a NGO), Bred (a regional bank in France) and Credit Cooperatif.

The following presentation explains what Babyloan does for MFIs: