Rang De: Crowd funding & Social Investment Platform in India

Introduction:

Rang De is Bangalore based Peer-Peer Lending and Social Investment platform, founded by Smita Ram and Ramakrishna in 2008.

Quick Facts

1. Rang De has over 12770 Social Investors
2. So far the team has distributed over 59935 loans across India.
3. 636.8 Million Rupees raised from contribution from Social Investors.
4. The repayment rate of Rang De is 94.02 % (Decreased from last year 98.3%)
5. Field partners has presence over 18 States in India
6. Great support to Education & women borrowers contributed 4344 Loans to students and 93.4 % respectively.
7. The great thing about Rang De is it has less interest rate in the industry.

“Rang De grew out of our frustration that the Internet in India was not being leveraged to aid the poor,” says Ramakrishna NK, who co-founded the organisation with his wife, Smita. “We were both inspired by Nobel laureate Muhammad Yunus’s Grameen Bank, but realised that conventional micro-credit in India was frightfully expensive.” The reason, the duo realised, was the huge cost of raising capital. “So we came up with the idea of peer-to-peer lending, or crowd sourcing, as a way to make micro loans cheaper,” he says. In their model, social investors (or lenders) can browse stories of borrowers, understand who they are and why they need a loan, and then contribute to the amount needed in multiples of Rs 100. The borrower repays the amount in a fixed time at an interest of 10 per cent. “From this, we deduct the field partner’s fee, a fixed contingency amount and our expenses, and return 2 per cent on the capital put in by our social investors,” says Ramakrishna. “It’s all transparent.”

Field Partners:

Just like Milaap, Rang De also have larger number of established impact Partners (Field Partners). As of now Rand De have 43 active field partners from all over India. More information about field partners can be found here The Field Partners will identify the potential people and Rag De will publish the story of an individual, so that social investors can choose the borrowers. As of now the repayment rate of rang De is ~94%. Rang De also provide an option, if any investor is interested in visiting the borrower they are free to do it. They also arrange phone calls with borrows, this makes the process more reliable for investors.

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Social Investment categories:

If any individual or organisation wants to invest through Rang De, they can choose their borrowers or can do quick invest. In first option investor can see the borrower and can read his story before lending. In quick invest any investor can just specify the amount they want to invest and Rang De will utilise the funds in right direction. Apart from this in quick invest one can select the “Business Sector/Field “, “Borrower State” and “Do not invest in meat & Tobacco businesses“ before investing so that Rang De will not provide loans to such business. Investors can choose different categories of business such as Microcredit, Education, Microventure, Sanitation and others.

Choose Borrowers:

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Quick Invest:

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Pricing & Interest Rates

Unlike other crowdfunding websites Rang De has its own way of implementing Interest rates to borrowers. It claims that the model is best in the industry and more effective for micro-finance.

Business Loan - 10% (field partner will charge 5.50%, Rang De will charge 2.00%, 2% will go to Social Investor, 0.50% will go as contingency fee)
Higher Education – 4.5% (field partner will charge 2%, Rang De will charge 2.00%, 0% will go to Social Investor, 0.50% will go as contingency fee)
Primary Education -6.5% (field partner will charge 4%, Rang De will charge 2.00%, 0% will go to Social Investor, 0.50% will go as contingency fee)
Microventure – 7% (field partner will charge 2%, Rang De will charge 2.00%, 2% will go to Social Investor, 1% will go as contingency fee)
Working Capital for Artisans – 5 % (field partner will charge 0%, Rang De will charge 2.00%, 2% will go to Social Investor, 1% will go as contingency fee)
Special Loans - 10% (field partner will charge 5%, Rang De will charge 2.00%, 2% will go to Social Investor, 1% will go as contingency fee).

I personally feel Rang De is the best crowdfunding website with minimum interest rates and strong network of Field Partners. I will try to elaborate different terms in Rang De in my next post.

All images are taken from respective websites as given in source, this is only my review about Rang De - Crowdfunding platform in India.

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