CARE works with local partners with specialist microfinance knowledge who lend to entrepreneurs in local currencies. Loans to entrepreneurs therefore have to be converted to and from GBP (via USD as this is the only globally accessible currency) and this is done using exchange rates that move daily.
To cover any exchange differences between when the loan is put on the Lendwithcare website and then sent overseas, and to ensure that the local partner and then the entrepreneur receives their full loan request, there is a 10% buffer on the loan to cover exchange rate fluctuations. Any part of the buffer that is not absorbed by the exchange rate fluctuations between the loan being raised and the loan being sent abroad is repaid to you. This is the first repayment on the repayment schedule.
We conduct regular evaluation trips to all of our partners to check that the loans requested are the loans that are given. This includes rigorously tracking a proportion of the loans and conducting face to face meetings with the entrepreneurs.
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