Liberty Finance directly addresses one of the largest challenges for citizens of developmental economies – access to the markets. Living in the US, we take for granted our access to the capital markets. By the time we reach college, credit card companies are literally mailing us credit every month asking us to open a credit card accounts. However, citizens in developing economies do not have this luxury. Most do not have access to a formal bank and access to a loan or credit is even rarer
If access to markets is the solution, then why haven't the markets provided access? Quite simply, there is much risk to lending to regions like Liberia. There is little information about the credit worthiness of the borrowers and there are even fewer lenders. Liberty Finance addresses these issues and has already seen incredible success. In fact they are already able to cover 2/3 of their operating expense from their lending operations. How has Liberty Finance already seen such success? Well, they are privy to local knowledge of the markets and have implemented innovated programs.
Local knowledge allows Liberty Finance to be able to see an individual's social capital within a community. Put in another way, if you don't have anything to put up as collateral and you don't have another way to prove your credit worthiness, what are you going to put up? Your word, your reputation, your social capital. Liberty Finance is actively involved in the communities they lend to. The borrowers of Liberty Finance also are helping to develop stronger communities. Liberty Finance has taken access to local knowledge one step further and has seen even greater success.
Liberty Finance is not simply a give me your application, here is your loan, and pay me the interest, type of operation. Instead, Liberty Finance has been able to develop their borrowers’ credit worthiness and build people's credit histories. Liberty Finance starts individuals on grants, then creates bank accounts and a habit of saving, and finally they have access to the credit markets. As a result the loans from Liberty Finance are not handouts from the government. The capital they lend is the actual savings the participants have saved. With over 5,800 clients, Liberty Finance has collected $140,000 in savings, loaned $135,000, and generated $25,000 in interest income. Now that's success.
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Liberty Finance directly addresses one of the largest challenges for citizens of developmental economies – access to the markets. Living in the US, we take for granted our access to the capital markets. By the time we reach college, credit card companies are literally mailing us credit every month asking us to open a credit card accounts. However, citizens in developing economies do not have this luxury. Most do not have access to a formal bank and access to a loan or credit is even rarer
If access to markets is the solution, then why haven't the markets provided access? Quite simply, there is much risk to lending to regions like Liberia. There is little information about the credit worthiness of the borrowers and there are even fewer lenders. Liberty Finance addresses these issues and has already seen incredible success. In fact they are already able to cover 2/3 of their operating expense from their lending operations. How has Liberty Finance already seen such success? Well, they are privy to local knowledge of the markets and have implemented innovated programs.
Local knowledge allows Liberty Finance to be able to see an individual's social capital within a community. Put in another way, if you don't have anything to put up as collateral and you don't have another way to prove your credit worthiness, what are you going to put up? Your word, your reputation, your social capital. Liberty Finance is actively involved in the communities they lend to. The borrowers of Liberty Finance also are helping to develop stronger communities. Liberty Finance has taken access to local knowledge one step further and has seen even greater success.
Liberty Finance is not simply a give me your application, here is your loan, and pay me the interest, type of operation. Instead, Liberty Finance has been able to develop their borrowers’ credit worthiness and build people's credit histories. Liberty Finance starts individuals on grants, then creates bank accounts and a habit of saving, and finally they have access to the credit markets. As a result the loans from Liberty Finance are not handouts from the government. The capital they lend is the actual savings the participants have saved. With over 5,800 clients, Liberty Finance has collected $140,000 in savings, loaned $135,000, and generated $25,000 in interest income. Now that's success.
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