Zidisha Helps Connect Lenders With Entrepreneurs In Developing Countries (2024)

Zidisha's Funding website / Credit: Zidisha

Zidisha is a non-profit startup that acts as an online microlending community connecting lenders with entrepreneurs no matter the distance or disparity. As of right now, Zidisha allows individuals worldwide to lend to tech-savvy entrepreneurs in the slums of Africa and Asia where even a few dollars can go a long way. Over 20,000 people are using Zidisha today. Recently, I spoke with Zidisha founder and CEO Julia Kurnia to learn more about the company.

“We’re riding on a huge, mostly unnoticed trend - young adults in the world’s poorest places are going online and connecting with the global community,” Kurnia said. “And when given the chance, they participate responsibly in web-based marketplaces. Zidisha has no loan officers or physical presence in borrowers’ countries, yet our repayment rate is comparable to that of small business loans in America.”

Unlike earlier microfinancing websites such as Kiva, Zidisha does not use local intermediary banks to manage the loans. Kurnia says that the average interest rate charged for microfinance loans worldwide is about 40% and even charitable loans funded through Kiva are passed on to the end borrower at an average interest rate of 35%. By eliminating intermediaries, Zidisha has been able to reduce cost to the borrower to just 5% of the loan amount. For transparency purposes, Zidisha displays the full cost so you will know how much the entrepreneur will pay for your loan. The entrepreneurs post their own loan proposals, answer questions and share updates regularly.

Young adults in developing countries may have a lack of essential resources, but they do have access to the Internet. And the lack of resources makes them resilient and ambitious. Formal jobs are not available so young adults in developing countries are turning to the Internet for self-employment purposes.

There are many positive stories about how entrepreneurs in developing countries have benefited from using Zidisha. Theresia Kabiti, a teacher and principal at a school in Kenya, used Zidisha to renovate a school and prevent it from flooding in the future to help educate local children. Siaka Traore, a farmer in the desert country of Burkina Faso, was able to buy a set of machines that grinds and presses manioc into a food called attièke -- which was previously done manually by women working day and night. And Ndeye Bineta Sarr, a cloth dealer in Senegal,utilized Zidisha to buy an electric sewing machine, rent a boutique workshop and turn a profit thathelped send her children to school.

Kurnia came up with the idea for Zidisha on Thanksgiving Day in 2008 when she was on a trip to Niger managing overseas grants on behalf of the U.S. government. Rather than bookingan expensive hotel, she decided to stay in a cheap hostel. The cost of the expensive hotel per day was more than what some of the Nigeriens earned in a whole year. When Kurnia was eating porridge at the marketplace, she was immediately surrounded by kids. One of the bigger kids grabbed the leftovers after she was done while the rest of them starved.

While working on government aid programs, Kurnia realized that handouts are a dead end that temporarily benefits the recipient. However, it makes the recipient heavily dependent on the donors. Before starting Zidisha, Kurnia worked in microfinance where small amounts of financing were given as loans to invest in activities that generate revenues.

In graduate school, Kurnia helped launch the first microfinance organization funded exclusively by capital raised through the Internet. The nonprofit she co-founded based in Senegal raised hundreds of microloans through Kiva at zero cost. After hiring a loan officer and opening an office, the nonprofit noticed overhead costs had skyrocketed. The interest that the nonprofit would have had to charge to cover costs would wipe out the profits for the borrower. That defeats the purpose of the loan entirely.

In 2008, cybercafes started to open up around the world even in the poorest areas. Young adults started using social media regularly because the Internet costs pretty cheap. And the younger entrepreneurs who wished to raise loans through Kurnia’s old microfinance organization in Senegal no longer needed a loan officer to communicate with Kiva lenders.

Zidisha acts as an eBay -like marketplace where the borrowers transact with the lenders directly and raises the funding they need for growing their businesses -- which is limited by their own track record of responsible repayments. Hundreds of volunteers and thousands of lenders and borrowers across every continent make up Zidisha’s community.

Another benefit of theloans processed by Zidisha is that it isrecycled to new entrepreneurs. The lenders essentially redistribute the funds to new entrepreneurs. “If you put $100 into Zidisha today, you can expect it to finance $200 - $300 worth of projects per year,” Kurnia says. If you want to become a lender on Zidisha, you can find a list of loan opportunities at zidisha.org/lend. You can contribute any portion of the loan from a dollar up to the full amount.

After the loan is fully funded, the entrepreneur confirms the payment and communicates with the lenders through the Discussion tab in the loan profile page. The repayment of your loan takes place in weekly installments. When the entrepreneur makes a repayment, the funds are credited back to your lending account. The repaid funds can be withdrawn at any time or you can choose to reinvest the money into new loans to other entrepreneurs. If a loan defaults, lenders receive a refund from a reserve fund paid into by borrowers when they first join the platform. With that said, Zidisha is not considered a financial institution or an investment service so it should not be used as a safe place to store savings or financial assets.

For security purposes, Zidisha verifies the identity of the entrepreneur by collecting their residential addresses, phone numbers, national identity numbers, loan applications and Facebook accounts. The loans are disbursed through banks and payment services that check government-issued identity cards.

On-time repayments are incentivized by limiting the loan sizes to small amounts for new entrepreneurs. The limits are increased only if they maintain high on-time repayment rates. The credit limits for entrepreneurs are also connected to the repayment performance of other entrepreneurs that they have referred to Zidisha. The entrepreneur’s historical on-time repayment rates are displayed on Zidisha too. And there is a feedback rating system left by previous lenders on the loan profile pages of the entrepreneurs.

Why the name “Zidisha?” “Zidisha” is the Swahili word for “grow” or “expand.” Since Zidisha is used to help businesses grow, it makes sense to use that word as the company name. Zidisha does not have any employees in any other countries, but a number of experienced entrepreneurs serve as Volunteer Mentors that monitors and assists entrepreneurs on a voluntary basis. There are also international interns that can visit entrepreneurs in the developing countries.

Entrepreneurs in most countries pay a one-time membership fee to Zidisha of about $10-$12 to help cover the operating costs. And new members make a one-time contribution of about $10-$30 to the Zidisha Members Loan Fund, which is used for funding loans and reimbursing the lenders in case of default. Those costs are paid only if the new member is able to raise a loan through Zidisha and it covers lifetime membership. Thereafter, entrepreneurs may raise an unlimited number of successive loans at a cost of just 5% of each loan amount.

Funds are transferred between Zidisha and entrepreneurs in Kenya using a mobile phone messaging-based money transfer service called M-PESA. In Ghana and Zambia, the funds are transferred through a similar service called MTM Mobile Money. And entrepreneurs in Indonesia use the mobile payment service Indosat Dompetku. When the exchange rates fluctuate during the repayment period, the U.S. dollar value of the loan may increase or decrease. The lenders assume the currency risk when bidding on a loan.

Sometimes there are extenuating circ*mstances for the entrepreneurs and they have to modify the loan installments due toweather issues or family emergencies. “In developing countries, incomes can be erratic. Businesses may make $100 one month and then nothing the next month. Or a child may get sick. There has to be flexibility in the system, but the entrepreneurs must be responsible. If the entrepreneur is having a hard time, they could pay $0.10 one week and$20 the next week,” said Kurnia during the interview. “You do not want to force people to decide whether to put food on the table or make a loan repayment.”

Zidisha was a part of the first batch of nonprofits that applied to the Y Combinator startup accelerator. Y Combinator was a big decision for Kurnia because herson was only two years old at the time and herhusband could not leave his job in Virginia. Kurnia ended up relocating to California for three months with her toddler to participate in Y Combinator. But the program was beneficial because Kurnia learned how to code and she rewrote the entire codebase for the website with a team of engineers. As a result, the lending volume on Zidisha tripled per month.

What are your thoughts about microfinance? Please leave a commentwith your thoughts about Zidisha.

Zidisha Helps Connect Lenders With Entrepreneurs In Developing Countries (2024)


How does Zidisha work? ›

Zidisha projects are not funded by any company or institution. Instead, ordinary people from around the world visit the Zidisha website and choose projects to fund. After using the funds for their projects, recipients then "pay forward" what they received by funding other Zidisha members.

Who owns Zidisha? ›

Zidisha was founded in October 2009 by Julia Kurnia.

Where is the headquarters of Zidisha? ›

Where is Zidisha 's headquarters? Zidisha is located in Sterling, Virginia, United States .

What are alternatives to Zidisha? ›

Zidisha alternatives
  • Kuhustle. 14 alternatives. Connecting you to Africa's top tech talent on-demand.
  • MicroHero. 9 alternatives. Earn money for charities by taking mini surveys.
  • Built in Africa. 3 reviews. ...
  • StartupApp. 8 alternatives. ...
  • Launch Africa. 5 alternatives. ...
  • Gigslot v-2. 8 alternatives. ...
  • Ajo Africa. 7 alternatives. ...
  • StartWeb Africa.

What is the interest rate for Zidisha bonus account? ›

Kes 0-9,999,999 : 1.2% Kes 10,000,000- 99,999,999: 2.2% Kes 100,000,000- 199,999,999: 3.2%

Is Zidisha a non profit? ›

(http://www.zidisha.org/) org(http://www.zidisha.org/) is an innovative nonprofit that lets ordinary web users make microloans to entrepreneurs around the world.

How do I contact Zidisha loan app? ›

If you do not have a Zidisha account, email team@zidisha.org.

What is Zidisha plus? ›

Zidisha Plus Voice Bundles

Voice Bundle. Safaricom to Safaricom Calling Rate Per Minute (KSHs.) Safaricom to Other Networks Calling Rate Per Minute (KSHs.) On-Net & Off-Net SMS Rate (KSHs.) Out of Bundle Data Rates Per MB (KSHs.)

How can I check my Zidisha balance? ›

Safaricom PLC on Twitter: "@dishonyakwara Advise the customer to send 'balance' to 144 to confirm the Zidisha balance.

What is the Paybill number for Zidisha? ›

1. You can fund from your Timiza account balance to your Zidisha savings account via Timiza app. 2. You cna fund through mpesa paybill bill number 600201 and your phone number as account number.

Which is the best bank in Kenya to save money? ›

  • Absa Bank Kenya Plc. Digital Savings Account. Interest rate. ...
  • Timiza. Timiza savings Account. Interest rate. ...
  • Choice Microfinance Bank Limited. Premium Savings Account. ...
  • Hazina Sacco Society. Ordinary Savings Account. ...
  • KCB Bank Kenya Limited. Simba Savings Account. ...
  • Co-operative Bank of Kenya Limited. Hekima Savings Account.

Which bank pays the highest bonus? ›

Current bonuses for our top 5 checking accounts*
  • Citibank: $200–$2,000.
  • PNC Bank: $50–$400.
  • SoFi: $50-$250.
  • Huntington National Bank: $400–$600.
  • Chase Bank: $200.
Jun 1, 2023

Which bank gives highest paid interest rate? ›

Outlook Money
Bank NameBest FD Rates (%)Applicable Tenor
Yes Bank8.25%35 Months
Indusland Bank8.25%2 Years Up To 3 Years 3 Months
AU Small Finance Bank8.25%24 Months 1 Day To 45 Months
Data as on respective banks' website on 07 Feb 2023. Compiled by BankBazaar.com
7 more rows
Feb 11, 2023

Who is the richest non profit? ›

Top Five Richest Non-Profit Organisations in the World
  • Catholic Charities U.S.A. Country of Origin: United States. ...
  • The Salvation Army. Country of Origin: United Kingdom. ...
  • United Way Worldwide. Country of Origin: United States. ...
  • Goodwill Industries International. Country of Origin: United States. ...
  • YMCA.
Mar 22, 2019

Which is the largest non profit organization in Pakistan? ›

Edhi Foundation is the biggest name in Pakistan's charity organization in Pakistan. It is one of the best social welfare service providers across the world running on the non-commercial, non-political, and non-communal basis.

Are non profit organizations owned? ›

A nonprofit organization is not “owned” by the people who start it, nor their successors in leadership. These individuals operate in a position of trust and accountability for the public at large, who, via government, allow nonprofits to operate exempt from the taxes that for-profit businesses must pay.

How do I apply for a zash loan app? ›

Zash Loan App in Kenya – Mobile Loans in 5 Minutes
  1. Download the ZASH LOAN app on your Android phone from Google Play.
  2. Register your mobile wallet (with M-PESA or Airtel Money).
  3. Select the amount you want to apply for.
  4. Fill out your basic information and upload photos of the front and back of your ID.

How to get a loan from Page? ›

How To Get A Page Loan In Less Than 3 Hours.
  1. Step 1: Get The Requirements Ready. ...
  2. Step 2: Proceed to the application portal to apply. ...
  3. Step 3: Get Approval and Offer (via Email/Phone) ...
  4. Step 4: Withdraw Your Money and Enjoy Life.
Mar 2, 2020

Can loan app access my contact? ›

“Apps that provide personal loans, or have the primary purpose of facilitating access to personal loans (i.e., lead generators or facilitators), are prohibited from accessing sensitive data, such as photos and contacts,” the company said in its update.

How do I pay for Zidisha plus? ›

How to Buy a Zidisha Plus Voice Bundle Using M-PESA
  1. Dial *485# then press the call button.
  2. Select “Zidisha Plus” option.
  3. Choose “Buy Bundles” option.
  4. Select the mobile number /employee you want to buy for.
  5. Choose voice bundles as the bundle type.
  6. Opt or the preffered Voice Bundles.
  7. Select “Buy using M-PESA”.
Nov 26, 2021

How can I check my Zidisha plus balance? ›

You have been subscribed to Zidisha Plus. Dial *485# to purchase bundles.,manage your employee mobile numbers or check balance.

How does Ubapesa work? ›

Ubapesa matches the lender and the borrower hence the name UbaPesa. The facility fees charged by ubapesa vary according to the number of days. The charges are 8%, 9% and 10% for loans of 10 and 30 days accordingly. The platform fees for the ubapesa app are charged at 44.75% and 15% for withholding tax.

How do I buy advantage plus minutes? ›

Dial *100# Select your preferred Advantage Plus bundle plan; Select the “PrePay' Option. Confirm your preferred payment option by selecting either Airtime or M-PESA.

What is Zidisha Paybill number? ›

1. You can fund from your Timiza account balance to your Zidisha savings account via Timiza app. 2. You cna fund through mpesa paybill bill number 600201 and your phone number as account number.

How do I check my all in one bundle balance? ›

How do I check my balance? Balance check on USSD *544# to show the balance of all the resources remaining (data and minutes). Can I make international calls using the bundles?

How do I buy Safaricom voice bundles? ›

Dial *444# from your Safaricom line and select “Talk Time Bundle”. Select 1 and enter any amount you wish to spend. Proceed to make payment through airtime or M-PESA.

What are the P2P lending apps in Kenya? ›

Some of the leading online lenders in Kenya include Branch, Tala, and Okash. There are also a number of peer-to-peer (P2P) lending platforms in Kenya, which allow individuals to lend money directly to other individuals or small businesses. P2P lending platforms in Kenya include Lentera, LipaLater, and Zidisha.

What is the number for Ubapesa Paybill? ›

You can pay loan via Mpesa Paybill no 144966 AC your mobile no. Then go to the app and click repay loan full loan.

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