In a recent Farming Times article, a new online lending platform called MicroGrain was reviewed. The founder and CEO commented, "...Our capital and operating costs are half of traditional microfinance companies, because we are not dependent on banks for capital and do not have a brick and mortar structure..." MicroGrain lends money to rural entrepreneurs at interest rates ranging between 10 per cent and 15 per cent as compared to traditional microfinance rates of 24 per cent to 36 per cent. Repayment rate among borrowers is 96% and increasing over time. Using the break even R formula we discussed in class, how can you explain the lower rates charged by MicroGrain. R = k/[q+(1-9)p] k = gross cost of bank q = percentage of safe borrower R = bank rate p = probability of obtaining revenue (0