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How it works

Behind the Scenes

In order to reach a broad range of borrowers, as well as serve the interest of all the stakeholders (borrowers and lenders), Milaap engages in a rigorous five step process to identify and select field partners.

1. Milaap ties up with a local partner.

Milaap identifies and partners credible, proven non-profit organizations and social businesses with a range of organizational types including microfinance organizations, vocational training institutes, artisan supply chains, schools to name a few.

Milaap’s field partners are established organizations that have a strong presence at the grassroots, a deep understanding of their communities and challenges, and a commitment to serve their needs.

These organizations disburse Milaap loans on the ground to specific borrowers and groups after identifying and appraising their applications.

2. Field Partners upload loan requests.

Upon completion of appraisal, field partners collect borrower stories, pictures and loan requirements and upload them on Milaap. These loan requests are assigned to and reviewed by Milaap’s volunteer editors who then publish them on Milaap’s site.

Field Partners disburse loans as soon as they are needed, or 90 days after (most choose to disburse funds before the loan request is posted).

3. Lenders browse profiles and lend

Lenders browse loan requests and select which ones they'd like to fund. They can lend as little as Rs. 1000/- ( ~$25) or as much as the entire amount of the loan. Lenders in India have the option to pay using local credit/debit cards as well as net banking. Lenders outside India can pay using any international card. Milaap aggregates funds from Milaap lenders and provides them to the Field Partner every month on a regular schedule.

4. Milaap disburses loans to the Field Partner

Field Partners disburse the loans to specific borrowers on a scheduled date, not more than 90 days from Milaap’s disbursement. In some cases, such as loans to pay for vocational training or emergencies, the field partners disburse loans as soon as they are needed and then upload the loan requests on Milaap.

They can do this up to 30 days before the loan request is posted on Milaap's website. The Field Partner uses the funds to replenish the loan they've already made to the borrower.

5. Borrowers repay their loans

The Field Partner collects repayments from Milaap’s borrowers, as well as any interest due, ranging from 5 – 12% on the loan. These are primarily used to cover field partner’s operating costs and a fraction of Milaap’s operational expenses, and is in line with the norms and rules set by the central bank.

6. Milaap Provides Repayments to Lenders

Field Partners transfer these repayments on a monthly basis, enabling Milaap to credit the appropriate lenders with their loan repayments. Lenders can re-lend their funds to another borrower, or withdraw their funds to their bank account.