Concepts such as solidarity or social justice seem foreign to the world of economics and finance. EthicHub comes to demonstrate that this is not the case with a creative proposal for investments with social impact that is proving to be a formula for success.
The system designed by this Spanish startup is based on the old axiom that by helping yourself you can also help others. That is precisely what is achieved: the mutual benefit of the two parties involved in the investment: the one who invests (and obtains profitability) and the one who receives the financing.
Collaborative financing, an idea with which both parties win
Let no one think that this is limited to a simple presentation of good intentions on paper and that later they come to nothing. The EthicHub system has proven to be effective (the figures, which we will discuss later, support this), because the idea on which it is based is solid.
A problem, a solution
In developing countries, For many small producers, access to credit is an impossible mission. Turning to banks and financial institutions means facing high expenses that they cannot bear. However, without these credits, it is unviable to launch new projects and maintain their livelihood.
EthicHub came to propose a solution to this problem through its platform collaborative financing whose operation is based on Blockchain technology. This allows the free circulation of money, reducing expenses considerably, below 1%. Conditions that the recipients of the credits can afford.
Mutual benefit
Moreover, investors can achieve high returns (between 6% and 8%), knowing that your investments are protected and insured thanks to a compensation fund. In any case, it should be noted that, in more than five years, the default rate associated with EthicHub investment projects is practically anecdotal.
As an added attraction, investors know that, in addition to making money, with their contributions they are contributing to a social impact action. This is the basis of the idea that we suggested at the beginning of the post: helping others and helping yourself.
As a summary, it can be said that it is a system in which both parties win:
- Investors obtain interesting returns with almost no risks.
- Small farmers can maintain their businesses, produce and export their products.
EthicHub's social impact projects
The real impact of these investments has a triple aspect: economic, social and environmental. Everything is better understood when we take a look at the list of EthicHub projects and the communities to which the investments are intended.
These are small businesses and cooperatives from several Latin American countries that need financing to launch their projects, keep their modest farms active and thus ensure their way of life.
With coffee aroma
Almost all of them focus their activity on the cultivation of coffee (in fact, EthicHub offers us the possibility of buying the delicious green coffee at a fair price from their own website).
It should also be noted that these local producers practice the traditional farming methods, a style of sustainable and environmentally friendly agriculture, totally different from that carried out in large monoculture plantations and other similar types of exploitation.
The investor can select one or several projects and choose the amount they wish to invest.
Brazil, Colombia, Mexico, Honduras…
Thanks to EthicHub, in recent years almost 600 projects have been launched in different countries. Many of them are still ongoing, which presents a great opportunity for socially conscious investors.
Some of the most notable projects are located in Colombia, the country of coffee. There, for example, we can help the La Labor Women's Association or Valle del Cauca Community to obtain the means they need to market their coffee abroad.
However, the bulk of EthicHub projects are concentrated in the central and southern Mexico, the most coffee-growing regions of the country. There are numerous cooperatives and small local businesses that can help: Azteca Community, El Progreso, Río Negro neighborhood, Camambé Canton, Agua Caliente Community, Toluca Ejido, Saljichí, San Rafael…The funds received are used for different purposes, from cleaning the land to harvesting and marketing the coffee.
Brazil and Honduras are other countries where EthicHub has started working. And in the medium-long term the list is expected to grow even more.
Although each community and region presents its own particularities, all projects have one element in common: contribute to the social development of agricultural communities and allow many families to obtain the income they need to get ahead. This may not be so important for a conventional investor, but it is for those who invest through EthicHub.