FINCA International (the Foundation for International Community Assistance) provides financial services to the world's lowest-income entrepreneurs so they can create jobs, build assets and improve their standard of living. FINCA operates with a distinct business model that integrates both donations and investments to maximize the capital available to clients. During financial year 2007, FINCA provided loans to more than 680,000 borrowers through an outstanding loan portfolio of $284.5 million. Loans were distributed through more than 69,000 village banking groups in 21 countries.
FINCA serves the lowest rung of the economic ladder, and focuses on serving those clients who earn less than $2 per day, of whom 72% are women. In 2007, our programs are providing financial services to more than 682,000 clients in Africa, Central Asia, Eurasia, the Greater Middle East and Latin America.
FINCA's Village Banking microloans provide small loans of working capital, with no collateral required and a reasonable interest rate, which are used to finance self-employment activities. Borrowers have a safe and stable place to accumulate savings, and a community-based support system that encourages self-worth.
FINCA recognizes that within each country, the social, political and economic realities determine the clients' needs. We continually improve products and services to meet clients' financial needs, ensuring that the organization will grow with the beneficiaries.
To meet with the huge demand for funds, FINCA created the FINCA Capital Fund, a credit enhancement program that helps FINCA's country programs qualify for commercial loans by providing collateral to commercial lenders. The programs, in turn, disburse the proceeds of these loans to FINCA's low-income clients. Investments by individuals, as well as institutions such as Calvert Foundation, provide the lending capital to FINCA.
FINCA serves the lowest rung of the economic ladder, and focuses on serving those clients who earn less than $2 per day. Because women comprise the largest segment of the severely poor, we target services primarily to women, who comprise 72% of FINCA's clients The majority of FINCA's village banking group members are traders, selling basic goods such as produce, shoes, clothing, wood, charcoal, poultry and fish. In addition, 22% are involved in production by cooking food products, sewing and tailoring, or making crafts. Six percent run service-based businesses including hair salons and bicycle repair shops, while two percent work in agriculture raising crops or livestock.
FINCA loans provide the working poor with the financial tools to improve both their own prospects and those of their families. In 2007, FINCA provided small loans averaging $493 to more than 682,000 clients. Its programs in Africa, Central Asia, Eurasia, the Greater Middle East and Latin America, together, lent more than $680 million through a loan portfolio exceeding $284 million while maintaining a portfolio at risk of less than 3%. In 2007, client savings increased to more than $23 million. Our programs in war-ravaged Afghanistan and Democratic Republic of Congo courageously brought tens of thousands of poor entrepreneurs into the global financial system.
When Gorreti Nambiru was a young girl, she worked to support her family instead of going to school. She married young, and then her husband was diagnosed with AIDS and died one year later, leaving her with her three children. Gorreti learned about FINCA through her mother, and got her first loan of $50 to buy maize in bulk and sell it to retail shops. Today, Gorreti has a loan of $1,000 and owns a flour store that employs five people. She is saving money to buy land and a car, and is able to send her children to school. Full Story