07.02.2005

Oikocredit marks 30 years of investing in people

Sumathi used to sit at a crossroads in a small Indian village begging for money.

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	Investing in the diguity of individuals and communities.

When Share Microfin Ltd., a microfinance organization in partnership with Oikocredit, approached her and asked how she would feel about a loan to start up some income-generating activity, she was reluctant.
Sumathi did not believe she had any skills that would provide her with an income, let alone enable her to repay a loan. But through the intervention of Share a process was begun that made Sumathi aware of her capabilities.
By telling about her life and her childhood she remembered that her grandfather used to go through the village selling stationery. Slowly Sumathi realized that she could possibly do this kind of work herself.
At a certain moment she was ready to accept a small loan. She bought pencils and pens and sold them in the village. For the first time in her life Sumathi earned her own money and was able to buy her own food instead of having to beg for it.
Share has received two loans from Oikocredit to expand their lending activities and help people like Sumathi.
Oikocredit is a socially responsible investment instrument created in 1975 that uses the investments of churches (including many Reformed churches in North America, Europe and Africa), church-related organizations, individuals and others to finance enterprises of disadvantaged people in the developing world.
By means of loans and guarantees Oikocredit enables poor people to start or upgrade their business. That way the poor, women and whole communities are given a chance to create a better life for themselves.
Over the years Oikocredit has financed more than 500 groups of weavers, coffee farmers, fishers, market vendors all over the world. During those years less than 15 per cent of Oikocredit loans had to be written off. The repayments enabled Oikocredit to refinance the initiatives of others.
Oikocredit has 11 regional offices and eight country offices in Africa, Asia, Latin America and Europe and an international support office in the Netherlands. Loans range from 50,000 to two million euros, with the average one being over five years.
Investors earn two per cent on their capital and, as Oikocredit says, their investment has a high social impact.
This year marks two important milestones in the world of microcredit. Oikocredit is celebrating its 30th anniversary and the United Nations, in an effort to recognize microcredit as an effective tool for poverty reduction, has declared 2005 as International Year of Microfinance.
Within the frame of the Year of Microfinance as well as its own 30th anniversary, Oikocredit will make itself heard in 2005. In February it organizes an international meeting on microfinance with the participation of the Dutch minister for development cooperation in the Netherlands, and in June an international symposium will be held in Bonn.
Oikocredit also calls upon all churches to celebrate its work on Oikocredit Sunday 16 October.
Oikocredit has long been convinced of the effectiveness of microcredit. Today half of its outstanding capital is with microcredit institutions. A survey conducted by Consultative Group to Assist the Poor last year revealed that Oikocredit was the largest supplier of private money to finance microcredit institutions.
They, in turn, try to help people like Sumathi. And it works.
After successfully repaying her first loan, Sumathi took a second one to buy a cart that enabled her to carry more merchandise and cover a bigger area. Thanks to Share and Oikocredit Sumathi realized she had the skills to trade and she developed this gift to her benefit.
From a poor beggar Sumathi turned into woman who walks with pride and dignity through her village. Oikocredit and Share collaborated to help her use her talents and change her life.

Oikocredit