MyC4

IFU and CSR Capital invest 2.2M Euro in Africa via MyC4

wiseclerk 3 Comments

The Industrialisation Fund for Developing Countries (IFU) and CSR Capital have decided to invest a total of DKK 15 million (approx. EUR 2.2 million) in Africa through MYC4. The Danish Development Minister Ulla Tørnæs supports the decision.

“This is an extremely important milestone for MYC4. That IFU and CSR Capital now invest through MYC4 is an endorsement of our initiative as a serious tool in the fight to eradicate poverty in Africa through the marketplace myc4.com,” says CEO of MYC4 Mads Kjær and continues:

“We hope this will inspire financial institutions, pension funds and companies to invest in Africa through MYC4. We are already well under way, but to make a significant difference for the development in Africa, this kind of investors play an important role.”

Political support
Danish Development Minister Ulla Tørnæs warmly welcomes IFU’s initiative to invest in Africa through MYC4.

“Danida has been the facilitator for MYC4. Through the Public Private Partnerships, Danida has supported the development of MYC4. I am glad to see the interest and support for the new marketplace. It shows the economic potential for investments in Africa,” says Tørnæs.

DKK 10 million from IFU, 5 from CSR Capital
IFU is an independent fund under the Danish Foreign Ministry. IFU’s purpose is to promote economic development in developing countries in partnership with the Danish industry, and now the fund invests DKK ten million in Africa through MYC4.

“With the investment IFU wants to contribute to poverty reduction and business development of small and medium enterprises in Africa,” says Investment Manager Kasper Svarrer from IFU.

In addition, the private investment firm CSR Capital invests DKK five million through MYC4. CSR Capital focuses specifically on social and environmentally sustainable investments:

“Good investments and development can and must go hand in hand in order to create the basis for sustainable economic, environmental and social growth and welfare in any society”, says CEO of CSR Capital Sven Riskær.

(Source: MyC4.com)

P2P lending companies by loan volume

wiseclerk 12 Comments

P2P lending is spreading internationally. While the biggest loan volumes are generated in the US market, many p2p lending websites have been established in other international markets.

The services can be divided in three categories:

  1. p2p lending marketplaces (e.g. Prosper, Zopa, Lending Club, Smava) – participants driven mainly by economic motives
  2. social lending services enabling micro financing (e.g. Kiva, MyC4) – participants driven mainly by social motives
  3. other concepts (e.g. Virginmoney which is special in the way that it does not do the matchmaking between borrowers and lenders, but supports the process between persons that already had offline relations- slogan “We manage loans between family and friends“)

Sites funding student loans can fall into any of these three categories or combine motivations.

P2P-Banking.com has created the following overview table listing services that are in operation and ranked them by loan volume. The loan volumes are not directly comparable for they are cumulative since launch of each service and represent different time spans.

Asked for a figure, a Microplace spokesman pointed out “…it is important to note that MicroPlace is not a P2P site.  We are a platform that offers investments to the retail public.“. No loan volume was quoted, but he stated “investments purchased on our site have enabled over 26,000 microfinance loans.”

In total approx. 685 million US$ have been funded through peer to peer lending/social lending services so far worldwide.

This image may be reprinted on other internet sites, provided it is not altered or resized and the following text (including the direct link to this article) is given as source directly below the image:
Source: P2P-banking.com

If you are a representative of a p2p lending service and want your service to be included in the next update of this table, please send me an email with information about your company.

MyC4 cancels 200,000 Euro pending Ivory Coast loans

wiseclerk 2 Comments

Myc4 logoMyC4 will cancel 105 open and pending loans to borrowers in Ivory Coast (Cote d’Ivoire). This is scheduled to take place next week. Money from the bids will be returned to the lenders. Some lenders are unsatisfied with the situation as the bids in these loans tied up their money for up to 6 weeks without interest.

Announcement from MyC4:

Notre Nation and Ivoire Credit have decided to cancel all open loans currently pending on the MyC4 platform. This is being done for two reasons.  First, both Ivoire Credit and Notre Nation are undergoing significant reorganization and operational changes, to plan for improvements and scaling of operations.  This is putting significant pressure on both organizations and we expect that there might be delay in some payments going forward. Second, there has been a relatively long period since many of these Businesses were uploaded, and the current expected loan disbursement dates. To ensure that the borrowers’ situations have not change would require a new due diligence of each, which current resources don’t allow, given the long list of loans.  Therefore and to protect Investors MYC4 has agreed to return all funds to Investors. This will be done within the next week. If you have money tied up in a Bid to any of these Providers your money will be transferred back into your Account immediately, when the cancellation is done of your specific loan. MYC4 is planning to cancel 105 loans.

MYC4 resume uploading of Businesses from Notre Nation and Ivoire Credit within the coming months, and they will continue to diligently manage the existing portfolio in the interim. If you have more questions please use the Blogs of Notre Nation and Ivoire Credit. We are sorry that your money has been inactive for 4-5 weeks and we apologize.

Source

7.9% ROI on my MyC4 loans in the past year

wiseclerk

MyC4About a year ago I started lending money to African entrepreneurs via MyC4.com.  So far it did meet my expectations. The process of uploading money worked without problems, there were always enough loan applications to select from and the offered interest rates were high enough to allow for good returns despite the risks. The only point, where the usability need to be vastly improved is a better status overview for the payment status of all loans in the portfolio. MyC4 does show the payment status in detail for each loan, but its hard to get an aggregate overview.

I invested at 13.8% average nominal interest rate. 194 loans are currently running, 29 are repaid in full, 12 are open/pending (not yet disbursed), 1 defaulted and 4 were cancelled.

To roughly calculate estimate my ROI I looked at my account display at MyC4

MyC4

About 12-13 months ago I uploaded 1,506.94 Euro. Now my account value is 1,625.24 Euro (9,09 Euro available + 124,62 Euro pending bids + 1.491,93 Euro Outstanding principal). That results in an ROI of 7.9% so far. Naturally it would drop, if the outstanding principal is not repaid in full due to defaults.

The ROI is much lower then the average interest rate, since it does take weeks before an investment in a loan becomes active – and unlend money does not yield interest. A further point is that several late loans affect the ROI.

Read all MyC4 posts from the past months.

MyC4 starts offering loans in Rwanda next week

wiseclerk 5 Comments

MyC4.com will start to offer loans in Rwanda next week. This is the fourth country MyC4 is lending at, after Uganda, Kenya and Cote d’Ivoire. Mads Kjaer, CEO of MyC4, is quoted that Ghana, Tanzania, Senegal and South Africa will follow. In 2009 he aims to serve borrowers in 20 countries in Africa. (Source)

In a danish television video (15 min, danish language), which was broadcastes yesterday, MyC4 is presented as a good alternative for investing and gains a recommendation of MyBanker.dk, a website comparing banks.

Checking on MyC4 late loans

wiseclerk 1 Comment

Lenders at MyC4.com do not have an easy task, when trying to check which of their loans are late on the repayments. The account page does not offer a comprehensive overview page. If a lender really wanted to check in detail he has to click through to the detail page of each loan he invested into.

Officially only one loan has the status ‘defaulted’ so far. However MyC4 so far has no standard policy when a late loan is to be declared defaulted. MyC4 has stated that there will be a default policy by the end of August.

Researching the situation, there are more than 320 loans that are late (fully or partly) with at least one repayment. Of these 72 loans are 3 payments late, 64 loans are 4 payments late, 30 are 5 payments late and 22 are 6 or more payments late.

Another issue that raised some concerns are the first impacts of the changed rules regarding currency risks.

… as some of you might have noticed already the first repayments are now posted on the investors accounts from Kenian investments where we investors are now taking the risk of currency fluctuations.

Within the first period from disbursement to the first repayment the KES has devalued from 97 to 104.5 = 7.2% already. … (Source: see discussion here)

To help lenders selecting loans to invest in, a column with the information whether a loan open for bidding is issued in local currency or in Euro was added to the wiseclerk MyC4 statistic pages.

(Source: uses information from Status der … MyC4 Kredite)