Budibank™

Bank with a Conscience™

Budibank is a website dedicated to finding the top social banking sites, coop banking services and Internet banking sites online.
Cooperative banking services came about as a great way to protect a community and help the people in that community to buy and sell goods in an efficient way that helps everyone. Nearly three-quarters (74 per cent) of Britons said they would consider borrowing or lending through a social lending community rather than their high-street bank.

Respondents to a survey by research house Social Futures Observatory (SRO) said they were wary of big banks' motives for lending, with 61 per cent of respondents believing the main aim of their bank was "to make money for themselves". Zopa is a UK peer-to-peer lending and borrowing site, putting people who want to lend in touch with those who want to borrow.

It is a social banking process that caters specially to the development needs of the poor in sharp contrast with conventional commercial banking, which has marginalised the poor. As is well known, commercial banks have not been successful in servicing the development needs of the poor given their profit orientation and style of operations. The transaction cost of servicing the poor has proved too high for commercial banks.

Moreover, high rates of loan delinquency and defaults have characterised their operations whenever they have stepped out of the mainstream to extend credit facilities to the poor. Let us start with some basic statistics about the Janashakthi banking societies. In the past three years, over 24,000 small loans (an average of Rs 1,600) have been given to poor women for either cultivation or self-employment activity, and the repayment record has ranged from 93 to 100 percent depending on the administrative division.

What?
Bust through tech jargon with silicon.com's Cheat Sheets. The SRO research found 81 per cent of lenders felt Zopa offers "significant control", compared to only four per cent who felt that way about mainstream financial services. Zopa borrowers echoed this view, with 70 per cent of borrowers saying Zopa offered "significant control", compared to only one per cent for mainstream banks.Interest rates also play a part with nearly eight out of 10 people who borrowed on Zopa saying the social lending site secures a lower rate of interest than is offered in the high street.

However, social lending is not without its problems. As curiosity in the concept of social lending mounts, the Zopa site suffered a minor crash on the evening of 23 November 2006. Dave Nicholson, co-fouder of Zopa, told silicon.com the site went down for around four minutes at 18:20 following a BBC report on Zopa which drove extra traffic to the site. The site received about four times the total daily number of visitors within the space of about 10 minutes, causing it to go offline, Nicholson added.

Social lending uses the age-old concept of borrowing and lending money person-to-person, which in the past has normally taken place in private between friends and family. Sites like Zopa take social lending into the public domain, cutting out the middleman and stopping the bank manager getting fat at everyone else's expense. Zopa was set up by some of the brains behind Egg, the UK bank which wrote the book on online banking, and currently has 105,000 members in the UK. See also Budiz.com - home of social banking services and coop banking and social lending websites.

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