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Do you have a little extra cash that you want to spend for a good <keyword id="22752" type="PERSON" weightage="100" keywordseo="cause">cause</keyword>? Have you always wanted to help a cause but didn’t know where to put your money? Or do you own a company that focuses on corporate social responsibility and wants to make sustainable <keyword id="6362476" type="ORGANIZATION" weightage="100" keywordseo="investments">investments</keyword>? One way of doing it is to donate the money, but there’s a small snag. The money you spend is gone for good – it can’t be used multiple times to help more people. But how about helping people as many times as you want, using the same capital you have spent in the beginning? And getting the entire amount back in monthly repayments? Call it sustainable giving or crowd lending, this kind of financial model enables you to do all these and one <keyword id="6404679" type="UNKNOWN" weightage="100" keywordseo="start-up">start-up</keyword> is leveraging it to enhance life at the <keyword id="140518" type="UNKNOWN" weightage="100" keywordseo="bottom-of-the-pyramid">bottom of the pyramid</keyword>. 
 Welcome to <keyword id="2108864" type="UNKNOWN" weightage="100" keywordseo="Milaap-Social-Ventures">Milaap Social Ventures</keyword>, a social enterprise operating from Bangalore and <keyword id="6356662" type="COUNTRY" weightage="100" keywordseo="Singapore">Singapore</keyword>, which has developed an online crowd-funding platform to help the unbanked and the <keyword id="2108896" type="UNKNOWN" weightage="100" keywordseo="Underprivileged-masses">underprivileged masses</keyword> in <keyword id="3658" type="COUNTRY" weightage="100" keywordseo="India">India</keyword>. Simply put, <keyword id="6734688" type="UNKNOWN" weightage="100" keywordseo="Milaap">Milaap</keyword> (it means ‘connecting together’ in Hindi) offers an RBI-approved micro-lending platform that allows the organisation to receive ‘loans’ from all over the world. Although <keyword id="2108903" type="UNKNOWN" weightage="100" keywordseo="Individual-lenders">individual lenders</keyword> don’t get ‘financial returns’ on their investments (after all, you are putting in your money for a ‘good cause’), they get the principal back after the stipulated period. They can then re-deploy the money to help another person/project or cash out their principal. This helps create a <keyword id="2108904" type="UNKNOWN" weightage="100" keywordseo="Continuous-funding-cycle">continuous funding cycle</keyword>, more effective and sustainable than one-time donations. Want to know more about how Milaap is connecting the haves and the have-nots in a bid to help implement life-enhancing projects? Here is a snapshot that captures the start-up’s vision and viability. 
 
Who runs Milaap (milaap.org): A team of three co-founders – <keyword id="1270675" type="PERSON" weightage="100" keywordseo="Sourabh-Sharma">Sourabh Sharma</keyword> (<keyword id="5645" type="POSITION" weightage="100" keywordseo="CEO">CEO</keyword>), <keyword id="2108870" type="PERSON" weightage="100" keywordseo="Anoj-Viswanathan">Anoj Viswanathan</keyword> and <keyword id="2108865" type="UNKNOWN" weightage="100" keywordseo="Mayukh-Choudary">Mayukh Choudary</keyword>. Sourabh, a graduate from the <keyword id="87108" type="ORGANIZATION" weightage="60" keywordseo="National-University-of-Singapore">National University of Singapore</keyword>, started his first company, a mobile app start-up, straight out of college and ran it for more than two years. Next, he had a stint with corporate houses but soon joined hands with the other two co-founders to start Milaap. 
 Anoj holds a degree in Engineering from the National University of Singapore and he is also a StartingBloc Fellow (2010). Prior to co-founding Milaap, he had worked with SKS <keyword id="113684" type="COMPANY" weightage="100" keywordseo="microfinance">Microfinance</keyword> and focused on the energy and water services space. Earlier, he had been at <keyword id="2108863" type="UNKNOWN" weightage="60" keywordseo="ReEx-Capital-Asia">ReEx Capital Asia</keyword>, a cleantech investment boutique in Singapore, and served as a fellow at D.light Design. He is also a founder member of the <keyword id="2108877" type="UNKNOWN" weightage="60" keywordseo="Microfinance-Society-in-Singapore">Microfinance Society in Singapore</keyword> and leads the Milaap team in India. 
 Mayukh is an <keyword id="198748" type="POSITION" weightage="60" keywordseo="electrical-engineer">electrical engineer</keyword> from IIT Madras and holds a PGDM from IIM Lucknow. He specialises in building technology-enabled financing models and worked as a <keyword id="2108874" type="UNKNOWN" weightage="60" keywordseo="financial-risk-consultant-in-Dubai">financial risk consultant in Dubai</keyword> before starting up Milaap. 
 
What inspired the venture: A sabbatical that changed life. In 2008, Anoj took some time off to be with SKS Microfinance and worked on a project to provide solar lanterns on credit in a few tribal villages in <keyword id="6357961" type="CITY" weightage="100" keywordseo="Odisha">Odisha</keyword>. There he met Mayukh who was then working with the solar lantern-maker D.lightdesign. While on this project, Anoj noticed how <keyword id="6621346" type="UNKNOWN" weightage="100" keywordseo="Small-loans">small loans</keyword> impacted life in a big way, especially at the bottom of the pyramid, and the idea of Milaap came to his mind. Developing a crowd-funding platform to connect India’s underprivileged with prosperous individuals and <keyword id="2108906" type="UNKNOWN" weightage="100" keywordseo="Institutional-lenders">institutional lenders</keyword> across the globe seemed the right way to go about it. Anoj, who knew Sourabh from 2006 when he interned at his previous start-up Microappli, got him and Mayukh together to give shape to the idea of Milaap, which finally went live in June 2010. 
 
What’s the pitch: <keyword id="2108919" type="UNKNOWN" weightage="100" keywordseo="Lend-a-little">Lend a little</keyword>, <keyword id="2108920" type="UNKNOWN" weightage="100" keywordseo="change-a-lot">change a lot</keyword> – that’s Milaap’s motto and it has started happening. “India has a large pool of people who don’t have access to traditional banking, but they do require <keyword id="2108923" type="UNKNOWN" weightage="100" keywordseo="Funds-for-self-employment">funds for self-employment</keyword> and developmental initiatives. So we are leveraging the global reach of the <keyword id="6357247" type="PERSON" weightage="100" keywordseo="Internet">Internet</keyword> and trying to ensure that people – either individually or through their <keyword id="23045" type="UNKNOWN" weightage="100" keywordseo="social-networks">social networks</keyword> – can raise and lend capital to the millions who are unbanked and underprivileged,” says Sourabh. 
 Milaap is currently targeting over 700 million Indians who are mostly living in the rural &amp; semi-urban areas and unable to access formal sources of <keyword id="6357455" type="EVENT" weightage="100" keywordseo="Funding">funding</keyword>. According to the social enterprise, less than 5% of them are able to procure reasonably priced, life-improving loans for their small businesses, vocational training or other essential household assets, and that’s where the ‘loans’ raised by Milaap come in . 
 
How it works: At Milaap, the work is done in two stages. One part is <keyword id="2108932" type="UNKNOWN" weightage="100" keywordseo="Shortlisting-borrowers">shortlisting borrowers</keyword> and publishing their profiles/projects on Milaap.org for crowd funding. Second part is deployment of the loans, monitoring their usage and ensuring timely repayments. Understandably, the second part is more cumbersome and requires a lot of offline work. Milaap has already tied up with 20-plus carefully selected ‘field partners’ (chosen from a wide range of <keyword id="164768" type="UNKNOWN" weightage="100" keywordseo="Microfinance-institutions">microfinance institutions</keyword> or <keyword id="113682" type="ORGANIZATION" weightage="100" keywordseo="MFIs">MFIs</keyword>, <keyword id="1417942" type="UNKNOWN" weightage="100" keywordseo="Social-Businesses">social businesses</keyword>, <keyword id="2108940" type="UNKNOWN" weightage="100" keywordseo="Vocational-training-institutions">vocational training institutions</keyword>, etc.,) to identify the most deserving candidates/projects for loans. Once they are selected, each <keyword id="2108943" type="UNKNOWN" weightage="100" keywordseo="Borrowers-profile">borrower’s profile</keyword> is uploaded on the site, along with the fund raised till date and the amount still required for completing the loan. 
 Lending online is quite simple, though. Browse through the profiles to choose a borrower or select one from an impact area that you feel strongly about. You can also use various parameters such as cause, <keyword id="6379164" type="ORGANIZATION" weightage="100" keywordseo="LOCATION">location</keyword>, <keyword id="2108946" type="UNKNOWN" weightage="100" keywordseo="Project-urgency">project urgency</keyword>, <keyword id="2108948" type="UNKNOWN" weightage="100" keywordseo="Repayment-period">repayment period</keyword>, women-centric projects to fine-tune your <keyword id="2108951" type="UNKNOWN" weightage="100" keywordseo="Borrower-search">borrower search</keyword>. After the loan payment is made online, Milaap disburses the amount to the concerned <keyword id="2108956" type="UNKNOWN" weightage="100" keywordseo="Field-partner">field partner</keyword> and the end-borrower gets it from the field partner. When repayment is done (end-borrower – field partner – Milaap), ‘credits’ are accumulated in your Milaap account. When the loan is fully repaid, you can either withdraw the money or roll it into another project. As for diehard do-gooders, there are even more options to <keyword id="2108961" type="UNKNOWN" weightage="100" keywordseo="Start-fundraising">start fundraising</keyword> for the projects you prefer. 
 
Claim to fame: The concept and the build-up. According to the co-founders, crowd-funding is still a niche concept in the country but it is gaining traction gradually. Till date, Milaap has raised and disbursed over Rs 8.4 crore in 8,633 loans, impacting more than 46,393 people across 11 states in India. These loans are essentially raised to fulfil a wide range of <keyword id="2108963" type="UNKNOWN" weightage="100" keywordseo="Developmental-requirements">developmental requirements</keyword> including <keyword id="566897" type="ORGANIZATION" weightage="100" keywordseo="basic-education">basic education</keyword> &amp; vocational training, <keyword id="572926" type="COMPANY" weightage="100" keywordseo="seed-capital">seed capital</keyword> for small businesses, <keyword id="2109008" type="UNKNOWN" weightage="100" keywordseo="Access-to-clean-water">access to clean water</keyword> &amp; <keyword id="49770" type="UNKNOWN" weightage="100" keywordseo="Sanitation">sanitation</keyword>, and <keyword id="2109012" type="UNKNOWN" weightage="100" keywordseo="Safe-lighting">safe lighting</keyword>. Moreover, Milaap boasts 100% repayment of loans till now, indeed a rare feat when banks and big <keyword id="34503" type="COMPANY" weightage="100" keywordseo="financial-institutions">financial institutions</keyword> (<keyword id="4776620" type="CITY" weightage="100" keywordseo="FIs">FIs</keyword>) are suffering from the rise in bad loans. 
 The organisation is also focusing on <keyword id="2109025" type="UNKNOWN" weightage="100" keywordseo="Pan-India-expansion">pan-India expansion</keyword>. “Earlier, we were mostly operating in states like <keyword id="20154" type="ORGANIZATION" weightage="80" keywordseo="tamil-nadu">Tamil Nadu</keyword> and <keyword id="13126" type="COMPANY" weightage="100" keywordseo="Maharashtra">Maharashtra</keyword>. But now we are scaling up our operations and growing in states like Odisha, <keyword id="65591" type="CITY" weightage="100" keywordseo="Mizoram">Mizoram</keyword> and even Gujarat,” notes Sourabh. 
 
Show me the money: While a borrower gets the entire sum offered by the lender, Milaap charges its field partners a 5% fee on the loans disbursed through them, to cover its operating costs. Its field partners, in turn, charge affordable interest from the end-borrower to meet their operating costs. Milaap also makes sure that all fees are disclosed upfront. 
 
Unlike many other ventures in this space, this social enterprise is a for-profit concern, but has not reached break-even yet. However, it has found some solid backers and already raised $1.1 million in Series A venture funding in May 2013. The money raised is being utilised for developing the online platform further and scaling up operations. “We want the number of lenders to go up to 100,000 in the next 18 months. That is the tipping point from where we can gather momentum and look at break-even,” adds Sourabh. 
 The <keyword id="2026013" type="UNKNOWN" weightage="100" keywordseo="Series-A-round">Series A round</keyword> was led by Singapore-based <keyword id="969909" type="ORGANIZATION" weightage="80" keywordseo="Jungle-Ventures">Jungle Ventures</keyword>, an early-stage investment firm and an approved <keyword id="2109042" type="UNKNOWN" weightage="100" keywordseo="Technology-incubator">technology incubator</keyword> under the <keyword id="2109044" type="ORGANIZATION" weightage="100" keywordseo="Singapore-National-Research-Foundation">Singapore National Research Foundation</keyword>’s Technology Incubation Scheme. Other investors included <keyword id="2109045" type="UNKNOWN" weightage="100" keywordseo="Toivo-Annus">Toivo Annus</keyword> (<keyword id="170488" type="POSITION" weightage="100" keywordseo="co-founder">co-founder</keyword> of <keyword id="6377887" type="COMPANY" weightage="60" keywordseo="Skype">Skype</keyword>), <keyword id="2072941" type="UNKNOWN" weightage="100" keywordseo="LionRock-Capital">Lionrock Capital</keyword> (a Singapore-based <keyword id="2109046" type="UNKNOWN" weightage="100" keywordseo="Family-investment-office">family investment office</keyword>), <keyword id="2108869" type="PERSON" weightage="80" keywordseo="Jayesh-Parekh">Jayesh Parekh</keyword> (Co-Founder, Sony Entertainment Television) as well as existing investor, <keyword id="1509738" type="ORGANIZATION" weightage="80" keywordseo="Unitus-Seed-Fund">Unitus Seed Fund</keyword>. The company is looking to raise a Series B round worth $3-5 million in the second half of CY2014. 
 Earlier, between August 2010 and January 2012, Milaap raised $250,000 in seed investment from Unitus Seed Fund, <keyword id="211897" type="COMPANY" weightage="60" keywordseo="First-Light-Ventures">First Light Ventures</keyword>, <keyword id="198636" type="PERSON" weightage="80" keywordseo="Vijay-Shekhar-Sharma">Vijay Shekhar Sharma</keyword> (Founder, <keyword id="338385" type="COMPANY" weightage="60" keywordseo="One97">One97</keyword>) and <keyword id="2108867" type="UNKNOWN" weightage="80" keywordseo="Rajiv-Madhok">Rajiv Madhok</keyword> (Founder, <keyword id="312199" type="ENTERTAINMENT" weightage="60" keywordseo="Oorja">Oorja</keyword>). 
 Interestingly, only 40% of the total lending amount comes from individual lenders (mostly from India, Singapore, the US and <keyword id="6356687" type="COUNTRY" weightage="100" keywordseo="canada">Canada</keyword>) while 60% funding comes from institutional lenders, social funding and even family offices. But unlike <keyword id="2109229" type="UNKNOWN" weightage="100" keywordseo="Small-lenders">small lenders</keyword>, large institutional and <keyword id="2109230" type="UNKNOWN" weightage="100" keywordseo="HNI-lenders">HNI lenders</keyword> get 3-4% return on their loans. 
 
Biggest challenge: There is competition from a few sites like <keyword id="1658892" type="UNKNOWN" weightage="100" keywordseo="Kiva">Kiva</keyword> or Wishberry, but it is still a niche space and <keyword id="2109065" type="UNKNOWN" weightage="100" keywordseo="Discoverability">discoverability</keyword> is the main challenge now, feels Sourabh. “We need to do more marketing and promotion to let people know such a platform exists. That will help us get more lenders on board, more field partners and subsequently, help more and more people get life-changing access to capital,” he says. 
 
A word for wannapreneurs: Take the plunge and do it. ‘Now’ is always a good time to do it – so don’t hesitate. I always feel that the risk part is overrated in entrepreneurship. You actually need the experience before you can succeed. So start early and make sure that you get the kind of experience you need for long-term success. Your first initiative may not be all that great but at least, you would have learnt from all your mistakes. Try fast and fail fast before you can succeed.

This Social
Enterprise Runs A Global Crowd-funding Platform; Eyes $3-5
Million In Series B Funding

Mumbai, Dec 5 () With a view to expand peer to peer (P2P) lending platform business, the Reserve Bank on Thursday raised aggregate lending limit by five times to Rs 50 lakh for such lenders. 
 At present, the aggregate limits for both borrowers and lenders across all P2P platforms stand at Rs 10 lakh, whereas exposure of a single lender to a single borrower is capped at Rs 50,000 across all NBFC-P2P platforms.
"A review of the functioning of the lending platforms and lending limit was carried out and it has been decided that in order to give the next push to the lending platforms, the aggregate exposure of a lender to all borrowers at any point of time, across all P2P platforms, shall be subject to a cap of Rs 50 lakh," the RBI said in its statement on developmental and regulatory policies. 
 Further, it has also proposed to do away with the current requirement of escrow accounts to be operated by bank promoted trustee for transfer of funds having to be necessarily opened with the concerned bank. 
 This will help provide more flexibility in operations and necessary instructions in this regard will be issued shortly, it said.
Commenting on announcement, NBFC-P2P platform Finzy head of product Apoorv Gawde said the decision will help expand the industry and increase the confidence of investors in the asset class.
 "It will help building scale in two major forms - existing investors who have experienced the power of P2P will now get an opportunity to increase their participation and a new segment of HNI investors will also begin to see the value of this asset class thanks to the increased limits," he said. 
 The statement further said a number of commercial banks, urban cooperative banks and other regulated entities are dependent upon third party application service providers for shared services for ATM Switch applications. 
 Since these service providers also have exposure to the payment system landscape and are, therefore, exposed to the associated cyber threats, it has been decided that certain baseline cyber security controls will be mandated by the regulated entities in their contractual agreements with these service providers, it said. 
 "The guidelines would require implementation of several measures to strengthen the process of deployment and changes in application softwares in the ecosystem; continuous surveillance; implementation of controls on storage, processing and transmission of sensitive data; building capacity for forensic examination; and making the incident response mechanism more robust," it said. 
 Detailed guidelines in this regard will be issued by month-end, it added.
 As recommended by the Task Force on Development of Secondary Market for Corporate Loans, the RBI will facilitate the setting up of a self-regulatory body (SRB) as a first step towards the development of the secondary market for corporate loans. 
 The SRB will be responsible for standardising documents, covenants and practices related to secondary market transactions in corporate loans and promoting the growth of the secondary market in line with regulatory objectives, it said. DP MKJ

RBI hikes aggregate lending limit to Rs 50 lakh for P2P lenders

New Delhi, Jan 24 () Private sector lender IndusInd Bank on Friday said it has launched its wealth management platform Pioneer Banking, which caters to high net-worth customers.
"Induslnd Bank announced the launch of 'PIONEER' Banking, its
wealth management platform," the private sector lender said in a BSE filing.
Based on research-based capabilities of the bank, the new service merges wealth management solutions with an array of personal and commercial banking products.
"Through this offering, we are bringing together superior privileges and lifestyle benefits, along with a wide array of curated banking products that suit the requirements of our valued customers....the PIONEER programme ...aims to restore the lost art of wealth management," Induslnd Bank Managing Director &amp; CEO Romesh Sobti said.
With no charges on non-maintenance of minimum balance, customers can enjoy the benefits of their Pioneer accounts without any worries, the bank informed.
"This new proposition will cater to the distinct and advanced wealth needs
of our HNI client segment," Induslnd Bank Head - Consumer Banking Sumant Kathpalia said. SID BAL

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This Social Enterprise Runs A Global Crowd-funding Platform; Eyes $3-5 Million In Series B Funding

Sanghamitra Mandal

RBI hikes aggregate lending limit to Rs 50 lakh for P2P lenders

PTI

Induslnd Bank launches wealth management platform

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