Going forward, first-time Zidisha borrowers no longer need to deposit the lifetime membership fee payment before receiving their first loan. Instead, the fee will be deducted from their first loan disbursement. In most countries, borrowers must make a deposit into a loan loss reserve fund before receiving their first loan. (This is a one-time fee, and covers lifetime Zidisha membership.) One month ago, we began asking first-time borrowers to pay the membership fee before receiving their first loan, instead of deducting it as we had done previously. Since we began requiring prepayment of the membership fee, 909 new members have raised their first loans, been fully funded and been invoiced for the membership fee. Of these, only 205 have sent payment. The rest have either had their loans expired and returned to lenders (after the two-week deadline to make payment passed), or will soon. Per borrower feedback, some are unwilling to prepay because they fear Zidisha is an internet scam. We knew this would be a problem to some extent, but didn't expect such a large majority would fail to prepay. More concerning is the feedback that some prospective applicants do not have the cash to pay the fee. Whenever possible, we want to avoid imposing requirements that block otherwise worthy applicants from joining us. It might be worth such a drastic reduction in successful loan disbursement if requiring prepayment improved repayment rates substantially. That doesn't seem to be the case so far though; of the 35 repayments that have fallen due for the borrowers who prepaid the membership fee, 87% were paid on time - that's not much different from our historical average. Though the data set is not large, it is not likely enough that the large-scale trend would be substantially different to be worth continuing the experiment. In addition to the hope that requiring prepayment of the membership fee would improve repayment performance, another purpose of asking new members to prepay the membership fee was to make certain that they understood and agreed to it. To help ensure consent going forward, new members will be required to explicitly confirm consent to have the fee deducted from their first loan, by checking a box once when they initially apply to join Zidisha, again when they post the first loan application, and once again when they confirm acceptance of the loan in the website after it has been funded.