Dan Murray, CEO of Opportunity International Canada wrote a blog post this week about the impact of the current global crisis on developing economies, Here’s a quick summary of the importance of OI’s Micro Finance programmes:
The essence of microfinance is financial inclusion.
Families trapped in ultra-poverty are marginalized at the fringes of society. Often illiterate and without equity, they are excluded from access to basic financial services that most take for granted — savings, mortgages, business loans, and insurance. Without such access, there is little opportunity to improve the quality of life or change the trajectory for the next generation.
Ethical microfinance provides financial inclusion to basic financial services such as micro-loans, savings and insurance, along with mentoring in business and life skills. This opportunity is all that is needed – clients take it from there to start a microenterprise that will provide a sustainable livelihood. Millions of clients have taken this journey of hope, providing for their families and often creating jobs for their neighbours.
The entire system is as sustainable and resilient as it is transformative. The basic transactional unit is a repayable loan with fair and manageable interest rates and repayment terms. For almost 50 years, the average repayment rate has remained consistently between 95% and 98%. This means that loan funds injected 20 years ago remain in circulation, loaned and paid out again and again in a virtuous cycle of poverty reduction.
Microfinance was one of the most transformative and sustainable pathways out of poverty pre-pandemic, and it will prove to be one of the best ways to regain the lost ground in the fight against poverty post-pandemic.
We’re proud to be supporters of Opportunity International and the valuable work that they do. Micro Finance not only helps a business owner, it changes families and communities.
Through our Slip Stream initiative we donate the first month’s accounting fees of all new clients towards OI’s projects in Honduras.
To learn more about Opportunity International check out their website, or join me at a webinar at 2pm EST on 29 September 2020 (7am 30 Sept in NZ) called “Business with a Social Purpose” where Peggie Pelosi, CEO of ORENDA and author of Corporate Karma, How your Business Can Move Forward by Giving Back will be facilitating a conversation about how corporate philanthropy has evolved into ‘social purpose’, and how weaving social purpose into the fabric of your culture can positively impact your business. Join us to discuss the why, how and importance of social purpose.
You will hear from these leaders of businesses with social purpose:
Tara Cochrane and Shawna Pereira, Wonderkind
Ryan Kononoff, Clearbridge
Stan Pauls, Decor Cabinets
And come away with ideas, practical tips and recommendations on how to engage employees, inspire customers and key partners.