How MicroGraam Works


How to Invest

  1. Choose a borrower, an amount to lend, and an interest rate to earn on the loan.
  2. MicroGraam then transfers the money to our partners. The partners disburse the loan to your borrower.
  3. The borrower makes monthly repayments to the partner organization. The partner organization repays MicroGraam, then MicroGraam transfers quarterly repayments into your ‘My MicroGraam’ account.
  4. At the end of 12 months, you loan will be fully repaid and you can choose if you want to relend to another borrower or withdraw your money and interest earned.

MicroGraam’s Principal Guarantee Fund

We want you to invest in MicroGraam borrowers without worry of default by borrowers. We have created a Principal Guarantee Fund, from which you will be repaid if your borrower is unable to repay the loan. Most MicroGraam borrowers earn about Rs. 100 per day for each working adult member in the family. As a result, they have very little disposable income for unexpected expenses such as sickness. Despite their challenging lives, our borrowers have maintained a 100% repayment rate since 2011. We believe that this shows their deep commitment to repaying every rupee of your invaluable loan. However, there is still a risk that a borrower is not able to repay the loan.

In order to lower this risk, MicroGraam has setup a Principal Guarantee Fund, which will repay investors in case a borrower is unable to repay a loan. The Fund covers 20% of all of MicroGraam’s outstanding loans. Each partner organization contributes 10% to the Guarantee Fund to cover their borrowers. The remaining 10% is contributed by MicroGraam supporters who want to encourage other social investors (like you) to invest without worry of default. For more information, please see the FAQ's sections or go to the Contact Us section for enquiries.