Jaldi 5 with Sourabh Sharma: Light up lives this Diwali!

08 Nov,2012

Milaap is a unique community welfare organization as it raises money not in the form of donation by way of loans which can then be claimed back by the donor. Set up by a group of professionals, it is now running a ‘Light a 1000 homes’ for Diwali (*see disclosure). MxMIndia Milaap interview co-founder Sourabh Sharma.

 

01.   Milaap is a unique concept in fund-raising where you loan money for causes as against donate. How has it worked thus far?

It has worked really well so far… Our company started in June 2010 and in the last two years, we have raised over 600,000 USD, with more than 5000 lenders — impacting more than 13,000 lives in India and we expect it to grow at much faster pace as more and more people are getting involved.

 

It’s critical that organizations who borrow pay back… is that secured?

 

Microfinance is unsecured lending in traditional banking parlance but it has seen better repayment rates than even the best of banks. The industry average is close to 98% repayment rate. This is because of the unique model of lending in joint liability groups where group members vouch for each other.

 

In our two years of lending, we have not had any defaults till date – which is a proof that the model works. Still, we clearly tell our lenders that lending via Milaap carries an inherent risk of loss in principal and therefore the motivation to lend is still primarily philanthropic. Additionally, our field partners do offer to cover up to 20% of the defaults in case there are any.

 

02.   Tell us briefly of the ‘Light a 1000 homes’ Diwali campaign…

As much as 50% of rural India does not have access electricity and are forced to use kerosene lamps for light and firewood for cooking. Noxious fumes claim a life every 20 seconds as a result of early childhood pneumonia, emphysema, cataracts, lung cancer, bronchitis which claim more lives than malaria or tuberculosis.  On this Festival of Lights, we plan to bring light to 1000 homes in India by providing them with solar lights and smokeless stoves thereby providing them with clean and healthy life.  People can either make a loan directly or adopt a village and help us raise funds by spreading the word among their friends. The cost of providing solar lights to 100 homes (village) is about 1lakh INR.

 

03.   Specifically, how has the response been?

The reponse has been great so far. Besides individual loans, we already have 22 fundraisers – where people have adopted villages are helping us raise funds from their friends. Adding to your previous question- fundraisers are another way of gaining traction hence we are looking to grow and much faster pace in the future.

 

04.   Would you say NRIs are more responsive than resident Indians

It really does not matter where the person is located. We have seen benelovent people making loans from all stratas of society  and both from within India as well as outside. In our limited experience, we have observed that geographical location or financial status has nothing to do with goodness of the heart.

 

06.   Apart from writing about Milaap, how do you think can Indian media and advertising help in your efforts?

By adopting a village and help us 🙂 Also, by writing about the change which has come in the lives of the people who may be poor but are equally hard working and smart and take control of solving their problems in their own hands.

 

Any efforts towards this direction?

 

Please look at some of the videos we have made of stories of change in the lives of the people we are helping: youtube.com/milaapdotorg We would love to invite people from the press to join us on our field assessment trips and write about working poor.

 

05.   What are your current promotional strategies and campaigns in India?

We primarily engage our audience via newsletters and social media (Facebook and Twitter) and also come up with seasonal campaigns such as the Adopt-an-entrepreeur campaign we did around Independence Day and now this Diwali campaign.

 

Disclosure: MxMIndia is supporting Milaap’s ‘Light a 1000 homes’ campaign for Diwali

 

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