This post illustrates how the rationale for group borrowing, using exorbitant interest rates is outdated. According to a Centre for Financial Inclusion report, in a survey in Ghana, 18 per cent of borrowers reduced their food intake and 5 per cent pulled their kids out of school to be able to repay the loans (read here). To bypass expensive intermediaries, Zidisha microfinance lets internet savvy micro-entrepreneurs connect directly with their funders (they have a background check conducted on them first) online. Their credit rating is given in an eBay like manner, making the idea of direct crowdfunding for microentrepreneurs, who can reasonably set their own interest rates, sound more feasible than expensive group loans. Read more here.