WCCN to join MicroPlace.com

By Emily Allred
Loan Fund Manager

WCCN is pleased to introduce a new and exciting way for individuals to invest in the NICA Fund — online. Through MicroPlace.com, WCCN will soon be able to offer NICA Fund Notes over the Internet. This technology will allow for investments in the NICA Fund as small as $50. We welcome this development in WCCN’s microfinance work as one that will enable more people to participate, and allow WCCN to better meet the demand for capital among the working poor.

Dr. Mohammad Yunus, founder of the Grameen Bank, helps the staff of MicroPlace celebrate its first birthday on November 13th. MicroPlace founder Tracey Pettengil Turner is at the left of the photo. Used by permission.

The mission of MicroPlace is “To help alleviate global poverty by enabling everyday people to make investments in the world’s working poor.” MicroPlace seeks to connect people in the United States with microfinance institutions around the world that are looking for funds. Their objective is to raise capital for these institutions so they can expand and reach more borrowers. Because of the similarity between Microplace and WCCN’s missions, we believe that as partners, we can be even more effective.

About MicroPlace.com

MicroPlace was created by Tracey Pettengill Turner, a social entrepreneur and seasoned business executive. She envisioned a company that could enable everyday people to invest in microfinance by using the power of web-based technology. She shared this vision with eBay, a company with expertise in connecting people, creating marketplaces and processing online transactions. eBay executives bought MicroPlace in 2006, recognizing it as an ideal opportunity to put eBay’s assets to work in a way that could be truly world-changing.

On October 24, 2007, MicroPlace officially launched on the web with the Calvert Foundation and Oikocredit as its first partners. In just one year, MicroPlace has raised millions of dollars for microfinance institutions served by Calvert Foundation and Oikocredit. We look forward to joining them soon.

MicroPlace in partnership with WCCN

Investing in microfinance through WCCN or other vehicles means purchasing a security — a tool for raising capital. For WCCN, the security is known as a NICA Fund Note, a debt we repay investors at maturity. Traditionally WCCN has issued NICA Fund Notes to members of WCCN who may have learned about the NICA Fund program through WCCN or through interactions with our members. This “word-of-mouth” strategy along with formal proposals to institutions has served to grow the NICA Fund over the years. But, while we are pleased to have added 34 new investors to the program last year, we realize that MicroPlace.com will give WCCN the opportunity to reach far more.

When individuals invest in the NICA Fund, WCCN staff corresponds with the new investor, creates an account, and ensures timely payment of principal and interest. Staff also manages investor accounts as needed, and provides investors with documents for tax purposes each year. WCCN remains committed to operating in this manner, but this method only allows for investments of $1,000 or more. MicroPlace is designed to handle these activities on a huge scale by introducing a streamlined, automated method of transacting and managing accounts.

How MicroPlace works

MicroPlace describes their model to investors this way: “A loan of a $20 can allow a poor woman to start a business and work her way out of poverty. In many countries, organizations that function like banks make loans to the poor. These organizations need funds to lend to the poor. Your investment helps fund these organizations. And, they are willing to pay you a return for the funds you invest. You can fight poverty and get your money back with interest!”

MicroPlace is registered with the Securities and Exchange Commission as a broker/dealer, so they are able to transact in securities on WCCN’s behalf. Microplace displays security issuers on their website by showing borrowers from the issuers’ partner agencies. If the viewer is interested in investing, the site lets the viewer lend to the issuer. For example, by the end of the year, a description of a NICA Fund partner agency and an example of a typical end borrower will appear on MicroPlace.com. This example may require the viewer to support the partner agency. To this end, MicroPlace will facilitate an investment in the NICA Fund, describing the investment as a “loan to NICA Fund partner agency via a NICA Fund Investment Note.” The NICA Fund prospectus will be available for download, and the viewer is guided through the transaction.

The viewer purchases their Note using PayPal, and MicroPlace collects the proceeds and forwards the funds to the issuer. MicroPlace assumes responsibility for supplying the buyer with a document serving as the security, conducting account maintenance, making interest and principal payments, and 1099 tax reporting. In this way, they function as an electronic brokerage firm. These services provided by Microplace will lend support to the day-to-day activities at the WCCN office. Investments through Microplace will basically be the counterpart to donations made through WCCN’s website. We are especially excited that MicroPlace’s technology will not only allow us to expand our outreach, but also add to the demographic diversity of WCCN’s membership.

We encourage you to visit MicroPlace at www.microplace.com, and please contact the WCCN office with any questions or comments you may have. We hope you will take this opportunity to invest in the NICA Fund electronically.