LWB is an intermediate that connects potential investors or lenders from all over the world with small-scale business owners in Uganda. We do not do any lending ourselves. Instead, we work with local partner organizations. When you lend money through us, a loan agreement will be set up between you and the partner organization.
Currently, Community Microfinance Ltd (CML) is our only partner. More partner organizations will be added when the capital raised by LWB exceeds what can be handled by CML or if LWB finds partners that can offer other types of investment opportunities. As the founder of CML started LWB, the two organizations are highly integrated and will be so even after other partners are introduced.
LWB aims to work only with partners that are similar to CML – small microfinance institutions that are locally owned and operate as companies limited by shares. Potential partners also need to sign an agreement where they commit to apply certain standards, for instance regarding the maximum interest rate charge to customers. You can read the partner agreement here.
Both LWB and the partner organizations face costs related to lending out your money. These costs are covered by the interest rate that is charged to the borrower. Therefore, 100 percent of your investment will reach the borrower of your choice.
Currently, the interest rate charged to the borrowers is 3 % per month or 36 % per year. The interest rate is used as follows: