Continuing our discussion on social entrepreneurship schemes and tools globally, below are three selected cases from Springwise * of using microloans for helping social causes.

Donation microloan hybrid helps rural Chinese

Microlending organisation Kiva has been praised for helping small businesses in developing countries get off the ground by connecting them to indivi dual lenders. Unfortunately, its innovative platform doesn't serve Chinese entrepreneurs, due to restrictions in China's monetary policy. Which is why Casey Wilson and Courtney McColgan established non-profit organisation Wokai, aiming to do for China what Kiva has been doing for other parts of the world. Since peer-to-peer lending isn't an option, Wokai developed a hybrid model that combines traditional donations with the benefits of microloans.

Dedicated to raising capital from around the world for entrepreneurs in rural China, Wokai works with field partners to select candidates for loans. Using a system that's similar to Kiva, people can browse a list of potential borrowers on Wokai's website, donate their chosen amount, and then track the recipient's progress through Wokai. Since they can't be paid back to the donor, loans are recycled: when a recipient pays back a loan to Wokai, the donor can select another farmer or entrepreneur to support. So far, Wokai has raised USD 42,766 for loans to 159 recipients. Many donors have business or family ties to China.

Fighting poverty through microloan guarantees

The California-based nonprofit United Prosperity is taking a different approach by focusing on providing loan guarantees. A traditional microloan or donation of USD 100 delivers roughly that same amount to the entrepreneur in need, but providing a loan guarantee of the same amount can result in a much larger loan from a local bank, United Prosperity says—as much as USD 666, in this case. How it works: Potential guarantors browse the United Prosperity site, which features a number of prescreened entrepreneurs in developing countries. They then choose one to help, and contribute a loan guarantee of any amount through PayPal. United Prosperity then consolidates the guarantees on multiple loans for the microfinance partner involved and issues a guarantee, which is deposited as collateral with the local bank. With the assurance of that collateral, the bank is then willing to lend funds—the amount depending on the guarantee percentage it requires—to the microfinance institution, which in turn lends to the individual entrepreneur who was supported. The guarantor can track the entrepreneur's progress building their business, and when the entrepreneur repays the loan, the funds are returned to the guarantor's PayPal account. United Prosperity, meanwhile, earns interest on guarantee funds; it's also considering charging its partners a small fee for providing the guarantee.

Now in beta, United Prosperity cites many advantages to providing loan guarantees rather than simple p2p loans: the process allows recipients to develop a credit history, making future loans easier to obtain; it reduces the interest rates banks charge the microfinance institutions involved; and it better manages risk while providing a more scalable model. So far, 111 guarantors have used the site to help 105 entrepreneurs with more than USD 11,000 in guarantees. One to partner with, emulate, or otherwise get involved in...?

P2P students loans for the developing world

Vittana is a Seattle-based foundation that focuses on educational loans. Now in beta version, Vittana partners with microfinance institutions (MFIs) throughout the developing world to catalyze new student lending programs. Potential lenders begin by browsing through the students profiled on the site—current examples include a 19-year-old woman studying industrial administration in Peru, for example, and a 25-year-old man studying financial accounting in Nicaragua. When they see one they'd like to help, they can lend as little as USD 25 toward that student's education. Vittana's local MFI partner—which has already verified that the students listed are hard-working and likely to succeed—then disburses the full amount of that loan to the student. Once the student graduates and gets a job, he or she starts paying back that MFI partner; when the loaned funds are fully repaid, Vittana returns to the lender the full amount that was lent.

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* Springwise scans the globe for the most promising business ventures, ideas and concepts that are ready for regional or international adaptation, expansion, partnering, investments or cooperation. We ferociously track more than 400 global offline and online business resources, as well as taking to the streets of world cities, digital cameras at hand.

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Photo credit: Kiva