More than 2 billion adults and 800 million young people lack access to public financial services. These people mainly live in developing countries and cannot open bank accounts for various reasons: they have little money, there are no banks nearby, they do not have the necessary documents or they cannot fill out documents due to illiteracy.
Hundreds of thousands of people are achieving financial stability and economic opportunity through microfinance. The main idea behind microloans is that they provide small amounts of money to people who do not have access to capital. It helps people living in poverty become financially independent, more resilient and able to support their families in times of economic hardship. With nearly half of the world surviving on less than $ 2 a day, microfinance is a vital decision.
Here are 5 main benefits of microcredit that you may not have thought about:
1. Easy to stretch to paycheck
One of the most common reasons for microloans is the financial hole in which a person finds himself when the next salary remains to wait too long. Regardless of the reasons for this situation, microloans are a convenient way out. But which microcredit organization is better to apply to? The service for the selection of microloans zzcash conducted a study, the result of which was the compilation of a rating of microcredit organizations, which will help you, if necessary, stretch to paycheck.
2. Easy access
banks simply will not lend to those with few or no assets, and generally they do not lend small amounts. Many people find it difficult to access bank loans because they do not have proper identification or title deeds for their land and home. Microfinance is based on the philosophy that even small amounts of credit can help end poverty.
3. Microcredits are not so "micro"
If you are an ordinary person with an average salary, then it may seem to you that microcredit is a trifle that does not give any advantages. But for a person surviving 100-200 rubles. a day, even $ 100 is a significant amount. People who take out such loans tend to save much more. Having disposed of this money correctly, a person can experience temporary difficulties associated with the loss of a breadwinner, job or other force majeure.
4. The best loan repayment rate
It has been noticed that microcredits are more often taken by women, who, according to statistics, are less likely to fail to repay loans than men. This allows you to make a better loan repayment rate for them. These loans help to empower women who find it more difficult than men to find work and somehow get a job in life.
5. Family support
In times of financial hardship, not only adults but also their children suffer. Having lost their jobs, people can suddenly find themselves without a livelihood. For the period of looking for a new job, they may not even have money left for food for the children. Microcredits - will be a perfectly reasonable way out in this situation.
6. And for business too
Even a small working capital loan of RUB 10,000 can be enough to start a small business that can help people lift themselves out of poverty. Nowadays, there are quite a few mid-sized businesses that, nevertheless, feed their owners. Any entrepreneur may experience financial difficulties at the very beginning, and often they do not have enough pennies to start a business. Many large companies demanded investments that were completely ridiculous by today's standards at the beginning of their journey. Just as a tree grows from a tiny seed, a business can start with an ultra-small investment.
