Yinongdai P2P Micro Loans Shines in Jiaxian County

Duan Lianyu, 48, is a farmer from Shanggaozhai Village in Jiaxian County, northwest China's Shaanxi Province. She has two sons who drive coal cars outside the village. Her husband also works in a coastal city, yet she is still living in poverty.

Jiaxian County, located in the northeastern part of the Shaanxi Province, covers an area of 2,028 square kilometers. It is a poverty-stricken mountainous county with a total population of 273,000, 91.4 percent of which work in the agriculture industry. The annual per capita income is 3,435 yuan (US$539) in 2011. Dates, potatoes and beans are local specialty products.

Duan was eager to make fortunes by her hands. Fortunately, she was able to be involved in the local Women's Development Association in 2002. Last year she borrowed 5.000 yuan (US$785) from the local yinongdai lending institution to purchase fertilizers and seeds. Altogether, she has 20 mu of farmland, most of which are ploughed to plant date trees.

Farm work is normally performed by men, but those females surrounded by loess lands patiently accept these hardships in order to carry the burdens of the families. Duan repaid the loans quarterly, each of which is 500 yuan (US$78.5), 1,000 yuan (US$157), 1,500 yuan (US$235.5), 2,000 yuan (US$314), respectively. The monthly loan rate was only1.33 percent.

"On year's end I repaid the total loans by growing date tress. I also harvested more than 20 packages of corns, soybeans, mungbeans and potatoes. Besides, I raised a dozen of chickens. Each can be sold for 15 yuan."said Duan.

Duan was not the only beneficiary.

Miao Xiaolian, 49, is also a poverty-hit farmer living in Qujiazhuang Village, 30 miles away from Shanggaozhai Village. Her husband died of a traffic accident. She has three sons working outside the home and one beautiful girl enrolled in the fourth grade.

In 2002, she was involved in the local Women's Development Association and borrowed 600 yuan (US$94.2) to buy two calves. Two years later, she raised the calves and produced new ones, to finally earn 3,500 yuan (US$549.5)--her initial gains. In 2006, she opened a small store beside the highway.

Last year, she borrowed 5,000 yuan (US$785) from the Yinongdai micro loan program with the five-household-based guarantee. In this agreement, five households sign a contract to repay each 5,000 yuan with 2 percent annual loan interests one year later. This repayment mode helps to reduce an individual's risk of uncertain sufferings and promote mutual cooperation.

During the time, Miao grew date trees on the hill, and sold cements, limes, and asbestos plasters outside her store. She also placed dried vegetables and native eggs on the road to attract tourists.

"My life is getting better and better”, said Miao, "We all can repay the loans on time. The Female Credit Association also offers us each 120 yuan (US$18.5) phone bills quarterly."

At present, China has a population of 128 million below the poverty line. Yinongdai micro loan program in Jiaxian County proves to be a successful tool for needy families, especially the rural female farmers struggling with poverty.

"Credit is asset"said Kang Caihong, Director of the Women's Association for Sustainable Development of Jiaxian County, "All of the farmers in Jiaxian County could repay off the loans. We regularly held micro loan centre conferences and set up different kinds of training programs."

Yinongdai, is the CSR project of CreditEase. It’s a non-profit peer-to-peer (P2P) mocro-loan lending website.which serves as a platform for online lenders to borrow money, from 100 yuan (US$15.8) and up for rural female farmers living in poverty. The lenders can receive an annual 2 percent loan interests. Although much lower than a bank deposit, it can help impoverished peasant households out of poverty and benefit local economic development.

The Yinongdai program uses an innovative five-household-based guarantee for risk control. It sets different repayment methods based on local conditions to help farmers improve agricultural products and living standards. So far, this program has covered seven provinces or autonomous regions across China.