United Prosperity is a

not-for-profit A nonprofit organization (NPO) or non-profit organisation, also known as a non-business entity, not-for-profit organization, or nonprofit institution, is a legal entity organized and operated for a collective, public or social benefit, in co ...

Web-based

microcredit :''This article is specific to small loans, often provided in a pooled manner. For direct payments to individuals for specific projects, see Micropatronage. For financial services to the poor, see Microfinance. For small payments, see Micropa ...

organisation. Unlike most

person-to-person lending Peer-to-peer lending, also abbreviated as P2P lending, is the practice of lending money to individuals or businesses through online services that match lenders with borrowers. Peer-to-peer lending companies often offer their services online, and ...

organisations, United Prosperity does not directly lend to the micro-entrepreneur, but instead the micro-loans are used to provide a

guarantee Guarantee is a legal term more comprehensive and of higher import than either warranty or "security". It most commonly designates a private transaction by means of which one person, to obtain some trust, confidence or credit for another, engages ...

to a local

bank A bank is a financial institution that accepts Deposit account, deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital m ...

, which lends to the micro-entrepreneur. Typically the local bank will lend about twice the amount provided by the micro-lender's guarantee, thus providing greater leverage than traditional

micro-credit :''This article is specific to small loans, often provided in a pooled manner. For direct payments to individuals for specific projects, see Micropatronage. For financial services to the poor, see Microfinance. For small payments, see Micropaym ...

. Another claimed benefit of this approach is that the micro-entrepreneur develops a relationship and, most importantly, a

credit history :''This article deals with the general concept of the term credit history. For detailed information about the same topic in the United States, see Credit score in the United States.'' A credit history is a record of a borrower's responsible repay ...

with their local bank, enabling the micro-entrepreneur to become independent of the micro-lenders in the long term. A criticism of traditional

models is that they can create a long-term dependency between the micro-lenders and the micro-entrepreneur as the micro-entrepreneur never builds a relationship with local banks. As of mid-2022, the unitedprosperity.org domain name is up for sale.

References

External links

Official Website
{{DEFAULTSORT:United Prosperity (Organisation) Microfinance organizations Peer-to-peer charities Peer-to-peer lending companies