Vancity Credit Union has a dandy idea for extending credit to folks who might normally find it hard to come by: peer lending. From CBC Vancouver:
Vancity’s Shaheen Tejani says the credit union lends money to groups of people, to allow individuals to start their own businesses – with the group taking responsibility for paying the money back.
“This is about the group, and knowing everyone, and not wanting to let them down,” says Tejani.
“These people work really really hard because the other people rely on them to make their payments on time. No one in the group gets their next loan if you aren’t paying your loan.”
Right now, the CBC reports, it’s still at the pilot project stage. Vancity will expand the program in concert with MOSAIC, Vancouver’s premiere immigrant services agency.
But it isn’t hard to imagine this working in other contexts as well, for groups that have traditionally found it hard to get the capital to start or expand enterprises — particularly people with low incomes and no assets.
Check out the Vancity FAQ on how it all works:
Group members approve each other’s loan requests and are collectively accountable for repaying the loans of all members within the group.
The group meets regularly, at least monthly, to support each other, to share each other’s success, to refer customers and to solve business problems.
Peer lending groups are a valuable source of support and networking. For many, these relationships with likeminded business people are essential to the success of their business….
Initial loans, known as Level One, are for $1,000. Subsequent loan amounts increase to a maximum of $5,000. For Self-Employment Program graduates the first loan level is $2,000, subject to the completion of a business plan and support of self-employment benefits.
Terms range from 3 months to 24 months and interest rates are based on prime plus 3%.
Incidentally, this is the first post I’ve written using the preview version of Flock, a web browser specially souped up for things like blogging, social bookmarking and generally making a positive nuisance of yourself. I’ll have more to say about it as I get more used to it.
Flock update, an hour later: It’s convenient, and that goes a long way, but…
But it produces some ugly code — lots of needless BR tags and such. Cutting and pasting didn’t work so well; soft line breaks were passed through to WordPress (as opposed to using the WordPress popup, which strips them). Indentation is handled by styling individual paragraphs or putting DIVs around blocks of text. Flock didn’t find my blog’s categories, either, and there was no option for saving the post for later editing.
Most important for blogging, Flock didn’t capture highlighted text in the story I was posting on, and didn’t pass through the URL. When I dragged text into the edit window, it lost important elements like paragraphing.
I’ll try again soon, choosing a different blog API within Flock.
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