WHAT DIFFERENCE BETWEEN MICROFINANCE AND INSTITUTIONAL BANK IS- PART 1

Micro-finance is a service where low-income individuals are allowed to access loans for their businesses without being required their collateral and also allowed them to open a new saving account with as low as #1000. It is unlikely to institutional banks that are required the low-income individuals to open with #10,000, #50,000 or over #50,000. And if any low-income individual wants to borrow from a bank for business or investment, he or she must be required their collateral in a managing banker’s hand with his or her own signature. The collateral should not be below a loan.

For microfinance, you are allowed to access a loan for only #50,000 or up to # 500,000 with zero or lowest interest rate. To learn more about microfinance, click here to read online micro lender. You are not allowed to borrow up to # 1million or over # 2million. And for institutional banks, you are allowed to borrow even # 10 million, etc plus your own 10 % or 20% pocket and they do not allow you to borrow #200,000 even #500,000 for the purpose of investment or business or real estate. 

But you will be paid higher interest rate with limited time as if you are forced unless you negotiate with the managing banker well. And if failed to do on time after being borrowed, your valuable collateral and other things that are more valuable than you borrowed will be taken away and you are continued to pay the interest for loan even you are in financial difficulties.

Without using leverage for a business, or real estate or investment, you can not make more money within less time even your own pocket. Many business investors become so wealthy within short time via the power of leverage. To take advantage of the leverage, you need knowledge well. You need one well-known financial mentor. You should close him or her for advice.

I hope you understand it.  

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