NOVICA launches online microfinance site to help artisans

Microfinance Focus, Nov. 23, 2009: International retailer NOVICA is launching the first ever peer-to-peer microfinance lending site where customers can lend money and purchase products directly from artisans, as part of its 10th anniversary. The new program will enable artisans in Asia, Africa and Latin America to expand their businesses and invest in their local communities.
“With NOVICA, artisans are already generating steady income through their online sales. Now, with our Artisan Loans program, they will be able to invest in their businesses, buy much needed materials and employ additional staff,” said NOVICA co-founder and CEO Roberto Milk. “Through these investments NOVICA can continue to play a role in growing small artisan businesses and making an impact on the artisan sector, generating economic development, and preserving culture and traditional crafts worldwide. Ultimately our goal is to raise millions of dollars in interest-free capital.”
According to Milk, the average microfinance loan size is $1,500. Customers can contribute whatever portion of that amount they’d prefer, and they will be repaid within one year. The loans are interest-free to the artisans.
“The most expensive component of microfinance is building an infrastructure of field offices to manage relationships with small borrowers. That is why traditional microfinance institutions need to lend at interest rates between 20 and 40%,” Milk said. “NOVICA already has that infrastructure, and our artisans are already generating income and do not pose significant default risks.”
Founded in Los Angeles in 1999, NOVICA.com (part of the National Geographic Family) is an online, fair-trade marketplace based in Los Angeles, with sourcing and direct-shipping offices in seven developing nations.
NOVICA features more than 30,000 limited-edition handmade works of art, including jewelry, apparel, handbags, rugs and tapestries, home décor items and a variety of collectibles.
The handcrafted products are sold globally through NOVICA.com, as well as the company’s network of wholesalers, and through catalog partnerships with National Geographic and the Art Institute of Chicago, among others.

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