What Is a Microfinance Investment?

Microcredit loans (microCredit) are personal or family-oriented business loans. Their main service targets are the majority of industrial and commercial self-employed individuals, small workshops, and small owners. The amount of the loan is generally less than 100,000 yuan and more than 1,000 yuan. Microcredit loans are an extension of microloans in technology and practical applications. The borrower does not need to provide a guarantee. Its characteristic is that the debtor can obtain the loan on its own creditworthiness without providing collateral or third-party guarantees, and the borrower's credit level is used as the repayment guarantee. Because this kind of loan method is relatively risky, it is generally necessary to conduct a detailed inspection of the borrower's economic efficiency, management level, and development prospects to reduce the risk.

Microfinance

Right!

If microfinance is defined as not needed

(1) Direct and transparent: The lender and the borrower sign a personal loan contract, and learn about each other's identity information and credit information one-to-one, and the lender knows the borrower's repayment progress and improvement of living conditions in time. Intuitively experience the value you create for others;

(2) Low threshold and low channel cost: P2P credit enables everyone to become a disseminator and user of credit, and credit transactions can be carried out very conveniently, everyone can easily participate in it, and make social idle funds better Local allocation will reasonably lead the surplus funds of high- and middle-income people to many low- and middle-income people who have good credit and need help.

(3) Risk diversification: The lender spreads the funds to multiple borrower objects and provides a small amount of loans at the same time, and the risks are dispersed to the greatest extent;

(4) Credit screening: In the P2P model, the lender can choose the creditworthiness of the borrower, and the borrower with a high credit rating will be given priority satisfaction, and the loan interest rate it receives may also be more favorable.

versus

In a broad sense, credit refers to the general term of credit activities with banks as intermediaries and deposits and loans as the main body, including

Wealthy people with idle funds; People seeking stable growth profits; Business owners; White-collar workers; Right

The investment threshold for microfinance financial management is low, at least RMB 100, and different products have different financial management amounts. It generally exists as a debt.