Babyloan 2012 - Annual Report by La Thénardière

micro credits, great stories 1st European social micro-lending platform

2012 Annual Report

www.babyloan.org - 2012 Annual report

Editorial

Once again this year, we are very pleased to tell you more about Babyloan, the French philanthropic internet startup. Our story goes on: nearly 4,000 microentrepreneurs were supported in 2012 thanks to the €2,000,000 you lent in France and in developing countries – hence a loan was made every 8 minutes and our activities knew a 70% growth compared to 2011. We intend to sustain our growth momentum and this is why the Babyloan team is focused on its mission: helping more and better. Our projects for 2013 are varied: we are planning to launch Babyloan in Italy, to form partnerships with new Microfinance Institutions, to improve the website and to organize a National Challenge once again. Besides, Babyloan strengthened its position among the other crowdfunding platforms as this market is currently booming: a new platform of this kind is created every day! By being the first microcredit crowdfunding community in Europe, Babyloan laid the foundations of a universal citizen bank – a dream we have nurtured since the launch of the website. We are proud to count you all in our community: thanks to your loans and your support, you encourage us to go forward. Thank you!

Aurélie Duthoit and Arnaud Poissonnier

2012 Annual report - www.babyloan.org

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Table of contents Babyloan, innovation for microcredit ...................................5 Babyloan and philanthropic microcredit .................................... 6 Babyloan, an innovating social business ................................... 7 Social entrepreneurship: a modus operandi to be proud of ..........7 Babyloan’s missions ..................................................................................7 How does philanthropic lending works? .............................................8 Babyloan’s business model.....................................................................9 Working with networks...............................................................................9

The team and the partners ........................................................... 10 Team picture..................................................................................................10 They support Babyloan..............................................................................12

Babyloan around the world......................................................15 Babyloan’s partners: the Microfinance Institutions.................. 18 Relationships between Babyloan and the MFIs ........................ 18 Monitoring the MFIs ....................................................................... 18 Selecting the MFIs........................................................................... 19 AFRICA............................................................................................... 20 SOUTH AMERICA............................................................................... 22 Southeast ASIA.............................................................................. 24 Central ASIA................................................................................... 27 EUROPE............................................................................................. 28

Babyloan editorial team: Marianne Chable, Florence de Maupeou Translation: Elise Peruzzo Graphic design and execution: Anne Saunier (www.la-thenardiere.com) Photo credits: Babyloan / Finadev - Benin / Chamroeun - Cambodia / Cepesiu - Ecuador / Adie - France / Afodenic - Nicaragua / Edaprospo - Peru / GDMPC - Philippines / Wages - Togo / SEDA - Vietnam / Asala - Palestine / Créa-Sol - France / CBIRD -

2012 HIGHLIGHTS................................................................................31 Best of 2012..................................................................................................32

Babyloan and the media................................................................ 34 From October 12th to 21st: the National Challenge................... 35 Why organizing a national challenge?..................................................35 Our partners during the National Challenge........................................35

Business Partnerships.................................................................. 36 Solidarity Challenges..................................................................................36 Philanthropic Revenue Sharing...............................................................37 Loan sponsorship........................................................................................37 Babyloan Gift Cards.....................................................................................37

The awards obtained by Babyloan............................................... 38 The Finansol label........................................................................................38 The Social Company approval..................................................................38 The microcredit Allen prize........................................................................38 The Economical Initiatives contest.........................................................39

The association Babyloan networks was launched................... 39

Financial Statements.....................................................................41 Balance............................................................................................. 42 Profit and loss ................................................................................. 43

Cambodia / Fundación Mujer - Costa Rica / MEC Delta - Senegal / KOMIDA - Indonesia Babyloan – 14 impasse Carnot, 92240 Malakoff contact@babyloan.org www.babyloan.org

www.babyloan.org - 2012 Annual report

Babyloan, innovation for microcredit

micro credits, great stories

Babyloan and philanthropic microcredit Babyloan.org is the first philanthropic microcredit platform in Europe. Private individuals can support microentrepreneurs from France and developing countries thanks to this website. Babyloan is very proud to announce that the outstanding loan amount rose from €2,750,000 in 2011 to €4,840,000 in 2012!

Babyloan key figures

asofDec.2012

Cumulated outstanding amount

Number of MFI partners €4,840,000 €2,750,000

€1,300,000

15 12 9 6 3 0

15 €500,000

12 12

€4,000,000 €3,000,000 €2,000,000

€1,000,000

10 6

2009

€5,000,000

What is microcredit? A microcredit is a low-amount credit bearing interests granted to microentrepreneurs who do not have access to traditional banking services. Microcredits can be granted to individuals or groups – the members of the group being guarantees for the others.

Babyloanians

22 000 €75 Average loan amount €103 Average amount invested on the platform Nearly 200,000 visits on www. babyloan.org

€0

2010

2011

2012

Microcredits

Microentrepreneurs

€4,800,000

of cumulated philanthropic loans

100% reimbursement rate

12 000 82%

18%

€413: Average loan amount

Microfinance in the world Microfinance is intended for people excluded from the traditional banking system, and provides them with financial services to expand an income-generating activity.

of the world population lives with less than $2.5 a day (Source: World Bank, 2008).

50%

of the world’s adults do not have an official bank account (Baromètre de la Microfinance, 2012).

±200 million borrowers,

93% of borrowers pay back their credits in time (MIX

€54 billion ($70,7billion) outstanding loan amount (MIX Market 2010) €426 : loan average size

80% of the borrowers are women (MIX

105 million of which are active borrowers (MIX Market, Dec. 2010)

Market as of Dec. 31st 2009)

Market. Dec. 2010)

for one borrower (MIX Market 2010)

www.babyloan.org - 2012 Annual report

Babyloan, an innovating social business Social entrepreneurship: a modus operandi to be proud of

What is a social business? It is a company with a social, societal or environmental purpose and with limited profits. A social business must meet the market requirements – e.g. reaching financial balance – as any other “classical” company but has to take other criteria into account: compensation for shareholders is limited, most of the profits are reinjected in the project, salaries are restricted, etc. Social businesses look to create democratic and participative governances.

Babyloan – which is a peer-to-peer lending platform – created a new form of solidarity and a new profession in France. Hence, we had to check if lending money online was legal by asking the regulatory authorities such as the Autorité des Marchés Financiers (the French stock market regulator) and the Banque de France (France central bank). For these legal reasons, it was difficult for Babyloan – which was a pioneer – to expand its activity in an associative framework at that time. In addition, the founders of Babyloan were deeply convinced that social entrepreneurship had many positive qualities. As a consequence they chose a simple entrepreneurial solution: the Société par Actions Simplifiée (which is similar to a limited liability company under the United States law) with a registered capital of €1,557,700 at the end of 2012. The articles of the company were modified to turn Babyloan into a “social business” and to change the Société par Actions Simplifiée into a “limited-profit” company. Since its creation, Babyloan has carried out 4 fundraisings. Due to them, Babyloan could collect €2 million from 40 social investors to carry out its activities until it reaches its financial balance, which is estimated to be in 2015. Babyloan tries to focus on social matters in the economy and to be involved in a more human capitalism: - Limited profit: Babyloan reinjects the money in the social objectives of the company and a minimum amount of the potential profits is used to compensate the shareholders. - Employees are shareholders. - Governance is being taken care of by shareholding institutions and NGOs. - Salaries are restricted with a maximum 1 to 5 ratio between the lowest and the highest salary (4.4 at the end of 2012).

2012 Annual report - www.babyloan.org

Babyloan’s missions Giving microfinance a social meaning by involving the general public Babyloan’s main mission is to help microentrepreneurs facing great financial difficulties to benefit from better borrowing conditions so that they can carry out their projects. In order to do this, Babyloan allows the general public to support microentrepreneurs all over the world – including in their own country – thanks to philanthropic loans. By receiving a philanthropic resource coming from the general public, Babyloan’s MFI partners save money on their costs and can thus concentrate on their social mission by lowering the interest rates charged to their beneficiaries. Indeed finding funds is a constant source of concern for MFIs, and this burden often makes them neglect their social mission. In addition, small and medium-sized MFIs experience difficulties in finding low-cost financing that would make their activities sustainable, despite the great success of microfinance over the last few years. It should be pointed out that traditional financial resources (banks, private equities, etc.) use 8 to 15% rates while the management fees invoiced by Babyloan are around 2.5%.

Supporting field partners and measuring social impact Babyloan designed a tool to assess the social impact of microcredits on beneficiaries which is based on tools recognized in the field of microfinance. This way, part of the information collected in the field is used to assess the social situation of the microentrepreneurs when they receive the loans. This assessment is based on 4 major points (financial situation, sanitary conditions, level of education and living conditions) with 8 corresponding questions asked in the field by the credit agents. This assessment has a double aim: first, it shows the internet users the social impact of their loan; and second, it shows the MFIs that tools can be useful to measure the social impact in order to extend the reach of their social mission. In addition, Babyloan chose to include a social performance monitoring form in the annual report asked to its MFI partners, in order to check the social impact of their actions throughout the years.

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Make the general public more aware of new forms of solidarity For Babyloan it is very important to raise the awareness of the general public about the different stakes of the new forms of solidarity – be it microfinance, solidarity on the web or social business. For this very reason, the entire Babyloan team has always been convinced that it is necessary to go past the virtual aspect of the web and to meet the general public for us to discuss and exchange points of view.

How does philanthropic lending works? Babyloan is the European leader in a new activity: peer-to-peer microcredit. Babyloan uses crowdfunding which allows several persons to finance one project, and microcredit which is a powerful tool to promote development and human dignity. Thanks to this method, the entrepreneurs do not feel assisted and get out of poverty thanks to their own work.

Babyloan’s website is full of interesting information about the different topics raised above. This educational approach is complementary to the company’s will to take part in forums, working groups and conferences in France, Europe or the rest of the world.

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What is crowdfunding? Crowdfunding describes a collective financial support provided to a chosen project. This financing method was created in the United States at the beginning of the 2000s and has expanded thanks to internet, which allows to link project holders and investors. The projects can be financed thanks to donations, loans (bearing interests or not) or capital investment. On Babyloan the internet user chooses the project he wishes to support thanks to a detailed form about the entrepreneur and makes a loan of €20 or more and gets his money back on a monthly basis.

www.babyloan.org - 2012 Annual report

Babyloan’s business model How can Babyloan make sure it is financially sustainable? This question is a daily challenge for the Babyloan team who must make sure the company accounts stay positive in order to cover the running costs, salaries, expensive development of the website and the necessary investments to achieve its mission. We chose to split the income among all the project stakeholders. The cost of Babyloan is thus reduced to a minimum for everyone. Fundraising • Revenues from fundraising • Commissions paid by internet users in 2012: €75,879 • Fees paid by MFIs to access the platform: €24,274 • Other activities creating income We also conceived a business model that not only depends on the money lent but also on the skills and resources of the Babyloan team. • Project sponsorship: €5,000 • Income earned for our counseling activities about the Babyfund Fixed Rate 2013: €22,698 • Solidarity Challenges sold: €29,648 Today Babyloan has not reached its financial balance yet as that is estimated to be in 2015, when there will be 65,000 members and when the net outstanding loans will have reached €20,000,000. A lot of challenges still have to be met by this young and creative social organization.

A full-transparency policy For example, when you make a €80 loan, you pay a €2 additional support commission to Babyloan and the microentrepreneur you decided to support is effectively granted €80. Babyloan does not take money from your loan to cover its operating costs which are borne by its additional income sources (such as the commission you pay when you make a loan) and by capital investments made by Babyloan’s social shareholders. NB: A new tariff grid will be put into practice on February 1st 2013. It will allow Babyloan to make its business model more sustainable.

Working with networks

Since its creation, Babyloan has been working with several partners in order to have a professional approach, to expand its concept and to structure its peer-to-peer lending activities.

This platform gathers 100 European organizations for them to share their thoughts and to promote innovative solutions to reach the Millennium Development Goals.

The Mouvement des Entrepreneurs Sociaux was created in 2010; this network gathers social entrepreneurs with the aim to expand and structure Social economy in France.

The association promotes solidarity in savings and finance and since 1997 has been delivering a label rewarding solidarity savings.

European Microfinance Platform is a network gathering 130 microfinance organizations working to facilitate the exchange of information and communication between the European actors of the sector.

This association gathers CEOs willing to promote a new entrepreneurship model and to support business and job creation. Entrepreneur’s network expanding a new model for companies and society based on efficiency, responsibility, equity and durability.

2012 Annual report - www.babyloan.org

This association was created in 2003 with the aim to promote microfinance in the European Union, as a tool to fight unemployment and social exclusion by creating microenterprises.

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micro credits, great stories The team and the partners Team picture The Babyloan Team is divided into 5 departments: the Management Department, the Communication and Marketing Department, the Microfinance Institutions Department, the Business Partnerships Department and the Institutional Relations Department.

The Management Department Arnaud Poissonnier CEO and co-founder Arnaud obtained a diploma to become a notary and started his career as a wealth manager, a job he describes as “technically fascinating, but humanly boring”. After working for several notable banks, he joined OBC and came across ACTED, an NGO supported by OBC since the 2004 tsunami. He went to Tajikistan one year later in order to support the ACTED staff in the field. He was fascinated by the humanitarian work he discovered and decided to work for ACTED, in order to help them structure a microcredit tool. He contributed to create the Microfinance Institution Oxus in 2005. After those experiences, Arnaud Poissonnier decided to create his own company: he launched Babyloan along with Aurélie Duthoit at the end of 2008.

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Aurélie Duthoit General Director and co-founder Aurélie graduated from the EDHEC Business School in 2004 and decided to finalize her training with a Master’s degree in business management in Argentina. She performed a one-year internship in Ecuador for the NGO Heifer (specialized in microcredit), which allowed her to see how microfinance improves a woman’s life: better living conditions, more self-confidence, more respect in their homes and communities. After a quick experience in the Sustainable Development department of a large company (ABN Amro France), she began working for Oxus, the microfinance branch on the French NGO ACTED. In September 2008, she launched Babyloan along with Arnaud Poissonnier. She is the mother of 3 children and has a genuine entrepreneur spirit.

Mariella Aritzu Administrative and Financial Manager

www.babyloan.org - 2012 Annual report

The Communication and Marketing Department Laure Cézard (came after Pauline in June 2012): Communication and Web-Marketing Director

Clotilde Noël Press Relations

Antoine Régeard Replaced Clotilde during her maternity leave

The Microfinance Institutions Department AnneCharlotteDupont Lhotelain Microfinance Institutions Department Director until Sep. 2012

Yasmine Hamraoui MFI Relations Manager (replaced Anne-Charlotte in September 2012)

Elise Peruzzo Translation and Profiles Manager

Charlotte Renard Freelance Translator for Babyloan

The Business Partnerships Department Mathias Faizand Director of the Business Partnerships Department

Laura Merckx Business Partnerships Manager

Baptiste Cammareri Business Partnerships Manager until October 2012

The Institutional Relations Department Florence de Maupeou Institutional Relations Manager

2012 Annual report - www.babyloan.org

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They support Babyloan Babyloan is supported by a one of a kind alliance between banks, NGOs and private investors to promote philanthropic microcredit.

The NGOs and Foundations Babyloan receives the support of ACTED (founder), Fondation Crédit Agricole Grameen, Etimos, Fondation AlphaOmega and Conseil Régional d’Ile-de-France through the Equisol fund. Feedback from Jean-Paul Huchon, President of the Conseil Régional Ile-de-France "The Région Ile-de-France (French region where Babyloan is implemented) is operating an ecological and social switch. To this end, one of its priorities is to promote Social Economy by offering financing resources adapted to this sector through Equisol, a social investment fund created by the Région Ile-deFrance which provides capital to innovative and ambitious Social Economy structures, such as Babyloan. The Région Ile-de-France wants to encourage the creation of social and innovative companies, this is why a regional Social Economy policy passed in November 2012." ©CR Ile-de-France

ACTED

The banks Babyloan receives the support of BRED (founder), Crédit Coopératif, Neuflize OBC, Crédit Municipal de Paris and 3 regional branches of Crédit Agricole: Centre-Est, Pyrénées-Gascogne and Franche-Comté. Feedback from Olivier Klein, General Director of BRED " For many years BRED has been promoting entrepreneurship and insertion thanks to microcredit, so it was natural for us to support Babyloan’s creation. BRED has co-founded Babyloan: its legal expertise was useful to develop and launch the online platform. BRED supports microcredit actors in France – such as Adie – and now all around the world through this platform helping entrepreneurs living in developing countries. In June 2012, BRED and the student’s association “Women Take the Micro” organized a 15day Solidarity Challenge. Thirteen projects lead by women were financed by employees, ©Philippe Matsas clients and members of BRED."

The Philanthropic Private Investors The private investors are: Arnaud Poissonnier (founder), Aurélie Duthoit (founder), the Baelen, Holweck and Dodin families, and around 20 other philanthropic private investors who share Babyloan’s values.

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www.babyloan.org - 2012 Annual report

The Strategic Committee This is Babyloan’s decision-making body. The committee holds meetings on a quarterly basis to decide on all strategic aspects of the project. It is made up of 15 people: a part of them represents the social investors and the others are recognized professionals of the social sector. The project founders, NGOs and partner banks hold a major part of the votes in this strategic committee. Feedback from Pierre Baelen, member of the Strategic Committee Pierre Baelen created the society BAELEN GAILLARD with François de Gaillard in 2003, which allows him to offer his skills in SMEs financing. BAELEN GAILLARD purchased companies in various business sectors, such as food-processing equipments, watertight joints and sport fields certification. Pierre Baelen is one of Babyloan’s shareholders and also a member of the Strategic Committee. This board gathers three to four times a year to make strategic decisions for the social business and to discuss Babyloan’s business plan. " When I met Arnaud Poissonnier I already have had the idea of creating a microcredit website for many years. When he told me he planned to launch his project, I did not hesitate and followed him right away in this adventure by becoming Babyloan’s shareholder. The aim was to share my knowledge of the industrial world and my skills in business creation, to create an innovative and social company. My approach was purely philanthropic, as I am personally convinced that a company like Babyloan is useful to promote entrepreneurship. Besides, as Babyloan is a website, the Strategic Committee has to manage the issues of a sector in constant evolution, which is interesting. This commitment also allows me to meet microfinance and solidarity actors through the Strategic Committee and the dynamic and professional Babyloan team." ©Baelen

2012 Annual report - www.babyloan.org

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www.babyloan.org - 2012 Annual report

Babyloan around the world

micro credits, great stories

Cr茅a-Sol France Adie France

Afodenic - Nicaragua

MEC Delta

Fundaci贸n Mujer

Senegal

Costa Rica Cepesiu Ecuador Edaprospo

Wages

Peru

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Togo

www.babyloan.org - 2012 Annual report

ASALA Palestine Oxus - Tajikistan

Seda Vietnam

CBIRD Cambodia Chamroeun Finadev

Cambodia

GDMPC

Benin

Philippines Komida Indonesia

2012 New MFIs

2012 Annual report - www.babyloan.org

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Babyloan’s partners: the Microfinance Institutions Babyloan is a tool designed for the general public: it allows internet users to discover microcredit and to take an active part in its development by lending online. Babyloan’s partners – the Microfinance Institutions (MFIs) – work in the field all around the world to make those loans possible. An MFI is a local structure providing financial and non financial services to people who often are excluded from the traditional banking system – this

is why they are called “Banks for the poor”. In spite of their strong social mission, the MFIs are not defined as relief organizations as they must reach financial balance. In fact, they can have various legal forms: mutual funds, NGOs, associations, commercial structures... and can be regulated or not, according to the jurisdiction of their operating country and their statuses. The MFIs select their clients and assess their needs in order to adapt their

credit offer. They analyze the credit demands, the projects’ viability and the reimbursement capacities of the clients. The MFIs lend money but they also support and train their clients, which makes them different from traditional financial institutions.

Relationships between Babyloan and the MFIs The Microfinance Institutions are key actors in Babyloan’s mechanic. As Babyloan provides a refinancing solution on its platform, the microentrepreneurs displayed on the website already received the money to expand their projects. Thanks to this system, the beneficiary does not have to wait for the Babyloanians to finance their loan to receive the microcredit. In its book of accounts, the MFI allocates the money lent by the Babyloanian to the entrepreneur he chose.

The MFIs are essential intermediate structures in the field: - They know the microentrepreneurs and their projects as they are frequently in contact with their clients, hence they can carry out a close monitoring. - They allow us to contact the microentrepreneurs, as they often do not have access to internet, know how to read and write and speak a common language with the lenders. -Theyprovidemoresecuritytothelenders as they guarantee the reimbursement if the microentrepreneur cannot pay back.

Why cannot we lend directly to the microentrepreneur?

It is the core of the platform’s model and strategy. In addition to the aforesaid practical reasons, Babyloan cannot do the work carried out by the MFIs: granting the credits, collecting the reimbursements and supporting the beneficiaries. Moreover, direct financing would expose the lenders to a high default risk, as it was already observed on other websites.

Monitoring the MFIs The situation of an MFI evolves throughout the years, so Babyloan asks its partners to send reports on a quarterly and yearly basis. This way Babyloan can assess the institution financial risk, governance and social mission. This information is then

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communicated to the internet users thanks to ratings displayed on the page of each MFI partner and on each project page. Plus, Babyloan carries out an annual country risk monitoring and a daily news follow-up in order to be informed

of all the political, economical and social changes in the world and more particularly in the countries where its MFI partners are located.

www.babyloan.org - 2012 Annual report

Selecting the MFIs MFIs are essential local structures for Babyloan, yet not every MFI can form a partnership with Babyloan. Babyloan gives priority to MFIs having a strong social impact and human values. Indeed, if an institution appears to be too financial, it often drifts from the original purpose of microfinance so Babyloan had to establish rules to manage the risk.

Required criteria . Global loan outstanding of €200,000 minimum . 2,000 active borrowers minimum . 3 years of experience minimum and 1 year of audited financial statements . Legal registration undertaken by a legal authority

MFI selection procedure Average duration to study a partnership: 6 months

1 First contact between Babyloan and the MFI . Babyloan analyzes the preliminary application . The MFI is audited / visited . The file is completed and sent to the selection committee for an overall analysis 2 Analysis of the application file by Babyloan’s selection committee . The committee makes its recommendations . The committee and Babyloan discuss the partnership potential 3 Final decision . The application is approved or turned down . Final decision . If the application is approved, the MFI is integrated and the contracts are signed

The selection committee: When Babyloan was created, its founders decided to create a selection committee gathering microfinance and finance professionals who assist Babyloan in the selection of its MFI partners. Here are the members of this committee:

The selection committee - Expertise field Bank

Microfinance

Consulting

F. Thiercelin - ABN Amro

J.H. Gallouët - Horus Network

M. Garnier - Kurt Salmon

D. Lachaut - Independant

M. Knaute - Oxus Network

Y. Zlotowski - Crédit Coopératif

P. Guichandut - Fondation Grameen Crédit Agricole L. Foschi - Etimos F. Renaudin - Entrepreneurs du Monde S. Vincent - Independant S. Jovic - Pamiga

2012 Annual report - www.babyloan.org

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AFRICA Finadev - Benin

Wages - Togo

Partnership started in July 2008

Partnership started in April 2010

Number of projects financed as of 12/31/2012: 1,204 Total amount lent as of 12/31/2012: €616,420

Number of projects financed as of 12/31/2012: 957 Total amount lent as of 12/31/2012: €575,360

MFI rating

Loan portfolio .........................................€9,500,000 Number of clients...................................5,200 Percentage of women.............................76%

Loan portfolio .........................................€23,000,000 Number of clients...................................33,500 Percentage of women.............................72%

Crédit © Babyloan

General presentation: Finadev is implemented in Cotonou and started its activities in 1998. After 10 years of experience in this sector, Finadev is now settled in 4 regions of the country – Borgou, Atlantique, Mono and Ouémé. The clients are mainly merchants, craftsmen, microentrepreneurs, wage-earners, farmers and breeders and 76% of them are women. In order to adapt its offer to the needs of its clients, Finadev developed – among others – a product named “Campagne” that meets the needs of farmers as it is seasonal, and another product called “Crédit scolaire” to help its clients deal with their childen’s school fees at the beginning of the school year.

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Crédit © Babyloan

General presentation: In 1993, most of the men living in Lomé lost their jobs during a general strike and had to leave the region because they had too few economic resources. The women were the only ones who could support their families, so they had to find informal jobs. At this time the NGO CARE supported the creation of WAGES, an association whose aim was to finance the activities of these women. In 1999, the association became a regulated microfinance institution and hence was able to establish and spread its activities. Today, WAGES is a major actor of microfinance in Togo. Its objective is to help low-income Togolese men and women by offering them financial services so that they can increase their income and improve the living conditions of their households.

www.babyloan.org - 2012 Annual report

New MFI Mec Delta - Senegal Partnership started in September 2012 Number of projects financed as of 12/31/2012: 15 Total amount lent as of 12/31/2012: €15,520

MFI rating

Interview of Mbaye Ndao

Financial stability................................... Social performance................................ Organization stability............................. Context/country rating.......................... Loan portfolio .........................................€480,000 Number of clients...................................1,400 Percentage of women.............................48% General presentation: In a small village of Northern Senegal called Ronkh, some young people decided to react to the rural financing system established by the government in 1984 by uniting and created the Foyer des Jeunes Agriculteurs. In order to adapt their products to the needs of the farmers living in the area, all the associations of Ronkh gathered to create a SACCO (Savings And Credit Cooperative, MEC in French) that was officially recognized in January 2000. In the following years, MEC Delta has developed its portfolio and spread its activities to other local communities (6 agencies). It also widened its clientele by offering its services to shopkeepers, craftsmen, fishermen, etc. MEC Delta also created new structures to help its clients who have since 2003 the opportunity to stock up in inputs, to use agricultural machines and to benefit from a commercialization service of their products. MEC Delta also has been offering trainings and an insurance service.

2012 Annual report - www.babyloan.org

Crédit © MEC Delta

My name is Mbaye Ndao and I live in Ronkh, a village located at the North of Senegal, in a province called Saint-Louis. My activity consists in setting up satellites, cable and television in my village and in the surrounding areas. I have been doing this job since 2008 and I recently needed funds to buy equipments (cables, extension cords) and to change the device that allows me to install television, this is why I asked a microcredit to MEC Delta. My dream would be to set up a large electronics company and to strengthen my skills in digital systems, in order to answer the needs of my clients in a more efficient way.

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SOUTH AMERICA Cepesiu - Ecuador

Afodenic - Nicaragua

Partnership started in March 2009

Partnership started in January 2010

Number of projects financed as of 12/31/2012: 1,575 Total amount lent as of 12/31/2012: €696,990

Number of projects financed as of 12/31/2012: 395 Total amount lent as of 12/31/2012: €259,120

MFI rating

Loan portfolio .........................................€1,300,000 Number of clients...................................3,500 Percentage of women.............................60%

Loan portfolio .........................................€5,900,000 Number of clients...................................4,900 Percentage of women.............................53% General presentation: AFODENIC (Asociación para el fomento al desarrollo en Nicaragua) is a nongovernmental organization created in 1999 in order to stimulate economic, social and cultural development for populations who do not have access to commercial banks. AFODENIC’s main ambition is to encourage production and trade, especially among rural and urban vulnerable populations and organized groups able to manage credit funds. Today the MFI counts with 7 branches and 60 employees.

Crédit © Babyloan

General presentation: Cepesiu was created in 1983 as a private non-profit organization in order to help local economies to grow in a fair and sustainable manner by supporting smallsized economic units. This MFI works in various regions of the country thanks to its branches located in Quito, Guayaquil, Riobamba and Esmeraldas. Cepesiu’s mission is to improve the living conditions of Ecuadorians by providing them financing solutions to develop local economies and to help the most vulnerable populations.

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Interview of Hazel Maria Hazel Maria, where are you from and what is your activity? My name is Hazel Maria Largaespada Jara and I live in Managua, the capital of Nicaragua. I took over my mother’s business; she created it 6 years ago and it is working well. I own a stall in the market where I sell articles for the house. Why did you need a microcredit? In order to offer a broader variety of products in my shop. Now my customers can buy baby articles, curtains, etc. What are your expectations for the future? I would like to offer security to my children and finance my retirement. Would you like to say a few words to the Babyloanians? My goal is to become financially independent, so I want to thank all the lenders for trusting me and I promise to make good use of the microcredit I obtained. www.babyloan.org - 2012 Annual report

New MFI Edaprospo - Peru

FundaciónMujer-CostaRica

Partnership started in November 2010

Partnership started in June 2012

Number of projects financed as of 12/31/2012: 604 Total amount lent as of 12/31/2012: €406,990

Number of projects financed as of 12/31/2012: 22 Total amount lent as of 12/31/2012: €20,580

MFI rating

Loan portfolio .........................................€1,700,000 Number of clients...................................5,700 Percentage of women.............................87%

Loan portfolio .........................................€1,100,000 Number of clients...................................2,100 Percentage of women.............................99%

Crédit © Babyloan

General presentation: Edaprospo was created in 1978 by a Peruvian sociologist, a French priest and a German cooperative director during a military dictatorship in Peru. Their goal was to support the 5,000 union leaders who were laid off after they called a national strike. Then, in the 1990’s, Edaprospo also decided to support small entrepreneurs – mainly unemployed people and immigrants – through a program named “Ecosalud” that aimed at improving their sanitary situation. At the same time, the organization tried to find solutions for groups who need financing so Edaprospo took part in the creation of the first savings and credit cooperative for itinerant sellers called CREDIVAC. Then Edaprospo created training programs, local credit organizations and financial support services that led to the creation of the microfinance program called PROSPERIDAD. Today, Edaprospo counts with 7 agencies and 40 employees.

2012 Annual report - www.babyloan.org

Crédit © Babyloan

General presentation: Fundación Mujer was created under the form of a pilot project by OFI International in 1988, and is now a NGO. At the beginning, this organization was dedicated to women living in rural areas and offered them - in addition to financial support - trainings to increase their empowerment and their personal development. Today, credit is the main product offered by Fundación Mujer, while trainings are a complementary service. Fundación Mujer is the fourth MFI launched in Costa Rica and now is one of the leaders in the country, as it is known for its commitment for women's emancipation.

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Southeast ASIA Chamroeun - Cambodia

Seda - Vietnam

Partnership started in July 2008

Partnership started in February 2009

Number of projects financed as of 12/31/2012: 3,770 Total amount lent as of 12/31/2012: €699,685

Number of projects financed as of 12/31/2012: 1,282 Total amount lent as of 12/31/2012: €327,650

MFI rating

Loan portfolio .........................................€3,500,000 Number of clients...................................38,000 Percentage of women.............................85%

Loan portfolio .........................................€580,000 Number of clients...................................4,000 Percentage of women.............................98%

Crédit © Babyloan

General presentation: Chamroeun was created in 2006 by Entrepreneurs du Monde (a French NGO) and it provides small entrepreneurs from Phnom Penh with high-quality financial products. The MFI knew a significant growth; it became a private limited company in 2009 and now runs 14 agencies. The offer of non financial products (professional trainings, awareness programs) has been increasing in the last years, hence optimizing the impact of the financial products. Today, Chamroeun wants to find answers to health, hygiene, education and environmental issues, thanks to partnerships with other organizations.

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Crédit © Babyloan

General presentation: SEDA (Centre for Small Enterprise Development Assistance) is a Vietnamese NGO created in 2003 in order to grant credits to underprivileged people thanks to its microfinance program called Binh Minh. SEDA is based in Hanoi; the MFI counts with 2 branches and works in 12 towns in Northern Hanoi. Since the Vietnamese law changed, SEDA has been in a transition period in order to change its legal status to a “Social Fund” – a fund which object is to finance the activities of precarious populations.

www.babyloan.org - 2012 Annual report

GDMPC - Philippines Partnership started in November 2011 Number of projects financed as of 12/31/2012: 697 Total amount lent as of 12/31/2012: €169,510

Interview of Francisco

Loan portfolio .........................................€2,900,000 Number of clients...................................14,600 Percentage of women.............................76%

Crédit © GDMPC

General presentation: Gata Daku Multi Purpose Cooperative (GDMPC) was founded in 1992 by a group of farmers concerned with their very low income. Therefore they looked for a way to make their activities more profitable and durable in their region which is one of the poorest of the Philippines. In 7 years, the 32 founding farmers managed and expanded the structure so well that GDMPC has been profitable since 1999. The MFI team works in 2 regions of the Mindanao province, which is located in the southwestern Philippines. GDMPC runs 7 branches in various regions of the country.

2012 Annual report - www.babyloan.org

Francisco, where are you from and what is your main activity? My name is Francisco Ordeniza, I live in Purok Bagong Lipunan, a hamlet of the city of Aurora in Southern Philippines. I have been running my own activity for 8 years, and it consists in making decoration objects with Lampakanay, a Filipino plant that I braid. Why did you ask a microcredit to GDMPC? I asked a microcredit in order to invest in my activity. This money allows me to take better care of my family because my income increased. My dream would be to buy a vehicle and to hire employees, this way my activity would be more efficient and more profitable.

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New MFIs CBIRD - Cambodia

Komida - Indonesia

Partnership started in June 2012

Partnership started in May 2012

Number of projects financed as of 12/31/2012: 79 Total amount lent as of 12/31/2012: €30,420

Number of projects financed as of 12/31/2012: 301 Total amount lent as of 12/31/2012: €35,500

MFI rating

Loan portfolio .........................................€1,500,000 Number of clients...................................3,200 Percentage of women.............................74%

Loan portfolio .........................................€6,200,000 Number of clients...................................90,900 Percentage of women.............................100%

Crédit © Babyloan

General presentation: CBIRD is based in Battambang, in Northwestern Cambodia and was created in 2000 as a NGO. At first, CBIRD's vocation was to create and manage training centers in remote rural areas in order to support the farmers, to minimize rural depopulation and to send children to school. Then, as the demand was high, CBIRD allowed its clients to pay credits in kind, under the form of cereal bags, which were reimbursed in cereals and interests were paid cash. In 2002, the farmers expressed their need of financing in cash, so CBIRD launched its microfinance program by asking legal permission to the central bank and with the support of the Rural Development Bank. At the beginning, CBIRD was very local and today the MFI spreads its microfinance activities in the surrounding regions thanks to its 5 branches.

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Crédit © Babyloan

General presentation: KOMIDA was created in 2004 as a foundation named YAMIDA; it was very active after the 2005 tsunami and helped a lot of disaster victims. KOMIDA granted its first microcredits at that time and became a savings and credit cooperative in 2008. The MFI is based in Jakarta and works in 3 Indonesian provinces: Aceh, Java and Sulawesi, thanks to 47 branches and over 500 employees. KOMIDA is entirely dedicated to Indonesian women, 90% of which live in rural areas.

www.babyloan.org - 2012 Annual report

Central ASIA Oxus - Tajikistan

Asala - Palestine

Partnership started in July 2008

Partnership started in June 2011

Number of projects financed as of 12/31/2012: 420 Total amount lent as of 12/31/2012: €327,940

Number of projects financed as of 12/31/2012: 277 Total amount lent as of 12/31/2012: €305,370

MFI rating

Loan portfolio .........................................€10,600,000 Number of clients...................................10,600 Percentage of women.............................34%

Loan portfolio .........................................€3,000,000 Number of clients...................................4,500 Percentage of women.............................100%

Crédit © Babyloan

General presentation: Oxus Tajikistan was created in 2005 to take up from ACTED’s microfinance activities in the country. Its mission is to fight poverty by providing the poorest people with an access to financial services. 80% of OXUS Tajikistan clients live in rural areas: 50% of them are merchants and 40% are farmers. Today, the MFI runs 5 branches and counts with more than 280 employees.

2012 Annual report - www.babyloan.org

Crédit © Babyloan

General presentation: ASALA is an NGO created in 1997 with the name Center for Women’s Economic projects by Oxfam-Québec with funds from the government of the Netherlands. In 2001, the organization is registered as an NGO, as a local microfinance institution working in Westbank and the Gaza strip. The MFI is based in Ramallah and runs 9 branches. It is 100% dedicated to women and helps them to reach financial independence. Asala provides its clients with a broad scale of financial and non financial products, as well as trainings and business counseling. Plus, Asala encourages its clients to get in contact with each other.

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EUROPE ADIE - France Partnership started in December 2010

Interview of Sylvie

Number of projects financed as of 12/31/2012: 87 Total amount lent as of 12/31/2012: €264,580

MFI rating Financial stability................................... Social performance................................ Organization stability............................. Context/country rating.......................... Loan portfolio .........................................€55,000,000 Number of clients...................................30,000 Percentage of women.............................40% General presentation: Adie is a microcredit pioneer in France and in Europe. It was created in 1989 by Maria Nowak who drew her inspiration from Muhammad Yunus’ Grameen Bank in Bangladesh and adapted it to an industrialized country. Adie finances all types of projects. The criteria taken into account are the capacities and determination of the entrepreneur as well as the viability of his project. Most of the projects are related to trade or services. Today, there are 130 local centers and 190 hotline centers in France. Nearly 500 people and 1,500 volunteers ensure the continuity of the phone service and are attentive to entrepreneurs. Since it was created in 1989, Adie has granted more than 100,000 microcredits, hence creating more than 100,000 jobs with a 2-year durability rate of 68% and an insertion rate of 79%. Adie sees itself as an airlock to enter the traditional banking system for those who do not have direct access to this kind of services. The potential microcredit demand in France is estimated at 300,000 loans each year, provided that the institutional context is favorable.

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©ADIE

" My name is Sylvie Turrel. I live in the Var, in the South of France, where I work as an itinerant seller. I mainly sell crafts from Egypt as well as organic and natural beauty products. I asked for a microcredit to Adie because my bank refused to grant me a loan, despite the fact that I had been their client for 25 years! This microcredit allows me to expand my customer base by taking part in bigger events. My goal for the future is to open a showroom in order to promote Egyptian craftsmanship in better conditions. This will allow me to support more families and communities in this country by buying their products. I already sent a thank-you note to all the Babyloanian lenders who supported my project, via Babyloan’s communication department, but I would like to say something to all the lenders: please, keep on supporting the projects you believe in!"

www.babyloan.org - 2012 Annual report

New MFI Créa-Sol - France Interview of Yvon " My name is Yvon Luneau, I live in Malakoff, in the suburbs of Paris. I am a furniture and objects designer; I created my company in 2009 but I decided to put all my efforts in it in 2011. In 2012 I finally ©ADIE launched SHOHAN-Design, my home-made French furniture brand. I asked for a microcredit to Adie in order to get funds to create coat pegs for a multimedia library. This microcredit allowed me to reach new customers and to show my ability to meet the demand of public places or architects when it comes to interior design. My wish for the future is to expand my company so that it satisfies my creativity and my commitment for sustainable development."

Interview of Romuald My name is Romuald, I am 35. I took a course to become a pastry chef and I decided to become self-employed so I created my own pastry company. I offer my services to professionals and private individuals; hence I can work for restaurants, hotels and tea shops as well as for special occasions such as weddings or birthdays. I also give pastry lessons. The microcredit I received from Créa-Sol allowed me to build up my company’s cash flow, so now I can expand my activity safely.

2012 Annual report - www.babyloan.org

Partnership started in November 2012 Number of projects financed as of 12/31/2012: 3 Total amount lent as of 12/31/2012: €11,000 MFI rating Financial stability................................... Social performance................................ Organization stability............................. Context/country rating.......................... Loan portfolio .........................................€5,400,000 Number of clients...................................1,800 Percentage of women.............................64%

General presentation: The Microfinance Institution Créa-Sol was created in 2005 by the Caisse d'Epargne Provence Alpes Corse. The head office is based in Marseille (South of France) and the 11 employees of the MFI work in 5 agencies located in Nice, Toulon, Avignon, Ajaccio and la Réunion, thanks to a small team of 11 people. Créa-Sol grants market rate credits to individuals for them to be more employable (driver’s license, vehicle purchase, training, housing, health, etc.) and to people who wish to create a business. The Créa-Sol team wishes to expand savings and insurance services in order to complete the credit offer. Today, the clients can have access to an accountant structure dedicated to micro-enterprises and can benefit from advice in accountancy and financial management. The microentrepreneurs are also assisted by the regional support and consulting system for micro-enterprises. Créa-Sol contributed to the creation of 820 jobs in 5 years.

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www.babyloan.org - 2012 Annual report

2012 HIGHLIGHTS

micro credits, great stories

Best of 2012 New MFI partner: Komida (Indonesia).

Babyloan gathers 14,500 members

January

May

February Babyloan is partner of the Festival Le Temps Presse, which aim is to communicate about the 8 Millennium Development Goals through short movies. Arnaud Poissonnier shares his experience as a social entrepreneur during the Salon des Entrepreneurs.

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March Babyloan receives the Microsoft Social Innovation award.

June Babyloan takes part in the Salon des Solidarit茅s. New MFI partners: CBIRD (Cambodia) and Fundaci贸n Mujer (Costa Rica).

www.babyloan.org - 2012 Annual report

Month of Social Economy

Buy’n’Loan: the merchants of the 20th arrondissement of Paris support microentrepreneurs by selling a product in their shop. New MFI partner: MEC Delta (Senegal).

CHALLENGE DAY: 8 students associations from business and engineering schools financed 16 microentrepreneurs in one day by collecting €6,470.

Babyloan takes part in the Forum Convergences 2015 and the Youth We Can event

September

November

October NATIONAL CHALLENGE: 2,000 new members join the Babyloanian community / 450 projects are supported / €230,000 are lent in 10 days.

December Babyloan gathers 22,000 members.

Arnaud Poissonnier performs a speech in La Cité de la Réussite. Babyloan gathers 20,000 members . Students of the French School of Lima organized a concert and raised €500 to support Peruvian microentrepreneurs on Babyloan. New MFI partner: Créa-Sol (France).

2012 Annual report - www.babyloan.org

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Babyloan and the media

The media have been attracted by the multiple initiatives launched in 2012; therefore during the past year Babyloan was the object of: • 137 articles in written press, 40 of which were regional; • 312 online articles; • 13 TV broadcasts; • 19 radio broadcasts.

Because of low budgets for communication and advertising, Babyloan banks on the media coverage to make the website visible to the general public.

Quotations "French Internet users can become their neighbor’s bankers."

Babyloan is mentioned in Philippe Gaudin’s column. C à vous - February 9th 2012

Babyloan.org is Olivia’s favorite in her web column. Télématin - February 24th 2012

February 4th 2012

"Among the pioneers of this new form of financing [crowdfunding], is the philanthropic microcredit website Babyloan.org."

"Giving is nice, lending is nicer"

"In the North and in the South, solidarity resides in lending." May 2012

March 29 2012 th

March 20th 2012

"Internet users surf the web to lend." June 25 2012 th

"Babyloan launches the first Solidarity Challenge." October 15th 2012

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"Loans are mainly granted to entrepreneurs in Sourthern countries and they create a significant economical and social leverage effect."

"Babyloan, the French gem of online philanthropic loans." October 13th 2012

October 12th 2012

"A human finance, a smiling finance, finally!" October 17th 2012

"Why lending? To change the world [...] A powerful and innovative philanthropic tool." October 12th 2012

www.babyloan.org - 2012 Annual report

From October 12th to 21st: the National Challenge Why organizing a national challenge? Work is never over when it comes to solidarity, it is a never-ending challenge.

Press advertising insert for the Babyloan National Challenge: “I prefer to invest abroad”

This is the reason why Babyloan decided to launch a national challenge in order to motivate always more people to support microentrepreneurs. The challenge: supporting 500 microentrepreneurs’ projects in 10 days, from October 12th to 21st 2012. How should we communicate about it? Thenationalchallengehadtobethehighlight of 2012, so Babyloan decided to create an unusual communication campaign along with a new web platform for this operation named “Je profite du système” (an English equivalent could be “Gaming the system”, as the users can see the lending process as a game). A shocking communication campaign was spread, including catchphrases with double meanings such as “I prefer to invest abroad”, “I take part in laundering abroad”, etc.

These double-meaning headlines were created to arouse the curiosity of the internet users and readers. Indeed as international finance has known some drifts and scandals, we decided to play with words to show that “invest abroad” can also mean “make a philanthropic loan to a Senegalese microentrepreneur” and that “take part in laundering” can be understood as “finance a launderette in Cambodia”.

Our partners during the National Challenge Babyloan had the opportunity to be helped by RAPP and Omnicom Media Group. These organizations supported Babyloan within the framework of the National Challenge through a communication skills sponsorship program with DDB Share. Besides, significant media and companies decided to take up the challenge: they were important allies for Babyloan as they offered more visibility to the National Challenge and took part in by making loans. Nearly 4 million Internet users were invited to take part in the challenge through articles, emails, banners or Facebook. It was a helpful boost to reach our objective: financing 500 microentrepreneurs.

2012 Annual report - www.babyloan.org

10 days later, what were the results? Within 10 days, the number of loans made to microentrepreneurs was multiplied by five compared to the usual number. This is a first for Babyloan!

Babyloan would like to thank all the lenders and partners who took part in this challenge!

Thanks to this operation, the Babyloanian community now counts 20,000 members. The Internet users showed that Internet could be a powerful tool to link Men, as 4,000 loans were made during the National Challenge.

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Business Partnerships The Business Partnerships department was created two years ago; its aim is to form partnerships with companies and works councils thanks to 4 offers:

Solidarity Challenges Rally your employees for a philanthropic challenge Thanks to the Solidarity Challenge, the employees of a company can make loans to finance microentrepreneur’s projects on Example of a Solidarity Challenge a web platform dedicated to the countdown event. The company sets the duration of the event and selects the projects to be displayed on the platform, so that each employee can choose the project he wishes to support. Plus, Babyloan provides the company with an animation kit (posters,

leaflets, banners, emails, etc.). As of today, Babyloan has led many successful Solidarity Challenges, the most successful of which were organized with MAIF, Alstom and CGGVeritas. The Solidarity Challenge is a powerful rallying tool: it allows gathering all the employees of a company around a philanthropic and innovative event.

Focus on The MAIF Solidarity Challenge, from April 2nd to 13th 2012 Interviews of Christian Ponsolle – Managing Director – and Marc Rigolot – Director of CIAMES. 1/ Why did MAIF decide to organize this Solidarity Challenge? This challenge is a social commitment which matches with the values of MAIF: “For many years MAIF has been working to give access to education to everyone, so we decided to launch a © MAIF Solidarity Challenge with Babyloan during the sustainable development week. It was a way for us to commit once again for our core values: respect, tolerance and solidarity”, says Christian Ponsolle, Managing Director.

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2/ What were the results of this challenge? “The results exceeded our expectations: within 10 days, the employees of the Group have raised €42,500 and MAIF invested the same amount, hence €85,000 were lent to 120 microentrepreneurs! The initial objective was to finance 30 projects for €24,000, so our participation was multiplied by three – I repeat: those were loans, not donations. This © MAIF operation was a beautiful way to gather the internal actors of the Group”, says Marc Rigolot, Director of CIAMES

3/ How can you explain this success? “Itcanbeexplainedbythreemainfactors: the employees took part because the values of Babyloan are compatible with those of MAIF, the management team participated by lending the very same amount as the employees, and the Sustainable Development network was very active”, declare Christian Ponsolle and Marc Rigolot.

www.babyloan.org - 2012 Annual report

Babyloan Gift Cards Make an original and philanthropic gift The Babyloan Gift Card (from €20 to €100) is a “voucher” for a philanthropic loan that you can offer to your employees or clients for them to discover Babyloan. First the person who receives the Gift Card visits Babyloan.org and lends the money to the microentrepreneur he chose. Then when the loan has been entirely reimbursed on the platform, he can choose to lend the money to another microentrepreneur or to obtain a gift voucher of the same amount to be used in various shops. The Babyloan Gift Card is an original and philanthropic gift for a company’s employees or clients (Christmas, Mother’s Day, retirement, etc.), hence works councils appreciate them.

FOCUS ON Focus on the Gift Card operation performed by the Vivendi works council "On June 7th 2012, Vivendi’s works council decided to gather all the employees of the group to make a presentation about Babyloan, one of © VIVENDI the first French social businesses. We chose Babyloan because I heard about microcredit in various broadcasts and about Babyloan by my relatives. I liked the idea of supporting microentrepreneurs facing bank exclusion in their country and it seemed natural for a works council – which object is social – to rally employees around Babyloan and to support entrepreneurs whose goal is to improve the living conditions of their families. Our employees had the opportunity to win Babyloan Gift Cards through a tombola and could invest in various projects. As of today, the money reimbursed on the platform is lent back to new projects on a regular basis." Claudine Brulard - CE Vivendi

Philanthropic Revenue Sharing

Loan sponsorship

Communicate about your philanthropic actions

Support microentrepreneurs with loans

This offer allows a company to involve its clients in its philanthropic actions by lending a part of its profits to microentrepreneurs. The company can decide to lend a percentage or a precise amount for each product sold, each contract closed or each order received. With the Philanthropic Revenue Sharing offer, companies can perform a marketing operation around a product or on a specific period in order to boost its sales by putting the highlight on its philanthropic commitment.

With this offer, companies can lend funds to microentrepreneurs on Babyloan’s platform. The same amount can be lent several times, as loans create a leverage effect which allows supporting several projects. A company performing a Loan Sponsorship can communicate internally and externally about the support provided to these projects, and can choose to support microentrepreneurs working in the same business sector as theirs.

2012 Annual report - www.babyloan.org

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The awards obtained by Babyloan The Finansol label The Babyloan loan obtained the Finansol label in March 2009. This label guarantees to the savers the investments they subscribed to are philanthropic and transparent. Since then, the Finansol label has been granted each year to Babyloan’s microloans.

The Social Company approval

The Microsoft Social Innovation Trophy

Babyloan was granted the « Social Company » approval in June 2011 by the prefecture of the Hauts-de-Seine (French department). This approval is awarded to companies which budgetary items are not exchangeable in regulated markets, and which meets some rules regarding hiring and salaries. This label underlines Babyloan’s management; for example the salaries are restricted with a maximum 1 to 5 ratio between the lowest and the highest salary.

The fourth Microsoft Symposium for Innovation was organized in March 2012. This event gathers famous French finance actors who meet to think about the future of the finance sector. Besides, the Microsoft Finance Innovation Trophies were handed over to innovative start-up companies. The members of the jury were particularly interested by Babyloan and decided to reward it with a special prize called Innovation Solidaire (Social Innovation).

The microcredit Allen prize The Allen prizes were created 27 years ago by Madeleine and Jean Cluzel and their name is a reference to the Duke of Bourbon’s motto “Allen” which means “all together”. Each year, “remarkable and democratic” books and human actions are rewarded by these prizes and Arnaud Poissonnier obtained the Microcredit Allen prize for his commitment in the sector. Feedback from Jean Cluzel The Babyloan rule of three

Jean Cluzel has been a French senator from 1971 to 1998 and member of the French Académie des Sciences Morales et Politiques (Academy of Moral and Political Sciences) since 1991. He has been involved in microcredit since 2010 by lending on Babyloan through the group Cluzelfondations.org. The group Cluzelfondations.org is made up of 21 people whose aim is to take part in a viable and sustainable development for future

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generations by putting honesty at the heart of finance. For two years (2009-2010), its members have been studying the existing solutions in France to take part in microfinance actions throughout the world. They decided to join Babyloan and two years later the results lived up to their expectations. “We chose Babyloan for five reasons. First, two of the assets of this company are its quick reaction capacity and the use of Internet. Plus, a thorough selection of Microfinance Institutions guarantees a 100% reimbursement rate. Furthermore, Babyloan encourages human success – most of the families asking microcredits say it allowed them to send their children to school. Finally, Babyloan creates a significant leverage effect: the lent amount is worth three times the invested amount. How can we explain it? The group lends back the reimbursed amounts instead of taking them out of the system. However, the loans with 11 or 12 months durations are quickly reimbursed on a monthly basis, which makes the capital rotate very quickly. Hence, the amount lent to microentrepreneurs was multiplied by three after a few months thanks to this leverage effect. Such is the Babyloan rule of three." Jean Cluzel Since 2010 Cluzelfondations.org has supported 546 entrepreneurs by investing €87,000 and lent more than €275,400.

www.babyloan.org - 2012 Annual report

The Economical Initiatives contest The Economical Initiatives contest is organized by Press&Vous (Groupe Wellcom), and grants awards to actions creating economical wealth, jobs and territorial cohesion. Each year, this event gathers more than 70 journalists to hand out 7 trophies. During the 9th edition of this contest, Babyloan obtained the “Special Trophy”, rewarding the jury’s favorite initiative and hence won a press relations campaign performed with the support of Press&Vous.

The association Babyloan networks was launched

N Babyloan decided to create an association named Babyloan networks, which was launched in July 2012. This structure is independent from the social business (none of the Babyloan team members are part of the association’s board of directors) and its aim is to carry out awareness campaigns about microfinance and social economy. Hence the association took over the pedagogical kit “Ma Classe Solidaire” (Solidarity at school) to provide it with more human resources and financial support – as an association can call upon volunteers and collect donations.

2012 Annual report - www.babyloan.org

The aim is to distribute this kit in many French secondary and high schools. The social business promised to donate all the commissions paid by members who knew Babyloan through Ma Classe Solidaire to the association. The pedagogical kit was updated in 2012 by Babyloan, MAIF and AFD: new parts were added to the document. More than 500 people already downloaded the kit and 48 classes signed up on the website! To download the kit in French, visit www.maclassesolidaire.com.

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www.babyloan.org - 2012 Annual report

Financial Statements

micro credits, great stories

Balance as of 12/31/2012 ASSETS (Net value in €) Brandnames, softwares and similar rights Other tangible assets Long term investments Other financial fixed assets Trade receivables Suppliers receivables Social security Income tax expense Turnover tax payable Others (amounts receivable from internet users to MFIs)

Unpaid subscribed capital Marketable securities Cash Prepaid expenses TOTAL Assets

12/31/2012 37 801 22 406 277 2 244 14 036 347 3 536 49 326 14 614 1 228 486

12/31/2011 37 937 25 655 278 2 100 4 140 839 2 224 16 531 6 670 783 402

607 358 1 810 1 982 241

206 558 95 443 503 934 1 559 1 687 270

LIABILITIES (Net value in €) Share capital Share capital premiums Profit/loss brought forward Profit/loss for the period Convertible bonds Loans Supplier liabilities Total tax and payroll liabilities (social charges provision) Turnover tax payable Other taxes Other debts TOTAL Liabilities

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12/31/2012 1 557 700 676 901 -1 786 656 -624 429 169 932 8 000 71 665 108 806 2 078 7 201 1 791 043 1 982 241

12/31/2011 1 405 300 569 426 -1 206 740 -579 916 119 952 8 656 29 953 73 946 5 924 247 1 260 522 1 687 270

www.babyloan.org - 2012 Annual report

Profit and loss statement as of 12/31/2012 PROFITS AND LOSS STATEMENT 12/31//2012 139 666 140 599

Net sales Total of operating income Purchase of goods External costs (website development and costs) 194 645

12/31/2011 92 826 92 899 1 005 184 588

Taxes Wages and salaries Social charges Depreciation of fixed assets Other expenses TOTAL operating expenses OPERATING RESULT Total financial income Total financial expenses FINANCIAL RESULT CURRENT RESULT BEFORE TAXATION Total exceptional income Total exceptional expenses EXCEPTIONAL RESULT Income tax expense Total income Total expenses NET RESULT

6 643 401 705 158 924 31 436 1 212 794 565 -653 966 567 6 016 -5 449 -659 415 3 309 1 118 2 191 -32 795 144 475 768 904 -624 429

5 243 319 318 122 043 59 366 1 265 692 828 -599 929 2 730 1 527 1 203 -598 726 3 696 1 418 2 278 -16 531 99 325 679 242 -579 917

2012 Annual report - www.babyloan.org

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