Opportunity International
Encyclopedia
Opportunity International is an organization that provides small business
loans, savings, insurance and training to more than two million people working their way out of poverty in the developing world. It serves clients in more than 20 countries and works with fundraising partners in the United States
, Australia
, Canada
, Germany
and the United Kingdom
.
Opportunity is a Christian
organization whose work is motivated by "Jesus Christ’s call to love and serve the poor," while serving all its clients regardless of their race, religion, ethnicity or gender. Opportunity was founded in 1971 by Al Whittaker
, former president of Bristol Myers International Corporation in America, and Australian entrepreneur David Bussau
. They established the organization, seeking a solution to extreme poverty
that would transform people’s lives while empowering them to financial independence and sustainability. Opportunity was one of the first nonprofit organizations to recognize the benefits of providing small business loans as capital to those working their way out of poverty, initially distributing these loans via the Trust Group model.
s who elect leaders and pledge to guarantee each other’s loans. Because the group guarantee replaces the need for collateral
, credit becomes available to those previously excluded from formal financial services. Each week, as Trust Groups gather to repay their loans, Opportunity provides educational sessions to develop business skills and enhance personal growth. In 2009, almost 1.2 million clients received transformative training on a wide range of topics.
clients. By providing professional training, the opportunity for advancement and competitive pay and benefits, Opportunity is equipping local staff to become leaders in building the economies of their own communities. Opportunity's states its four core values as respect, commitment to the poor, integrity and stewardship. It strives to have these values exemplified in its worldwide staff in relating to clients, colleagues, donors, visitors, vendors and all people.
s and point-of-sale (POS) devices offer the only safe method for transactions in many markets. Cell phone technology gives clients in remote locations affordable, reliable access to their accounts. Grants from Omidyar Network and Credit Suisse help support Opportunity’s “electronic wallet” strategy.
, Peru
, Honduras
, Kenya
, the Dominican Republic
and Indonesia
.
Australian philanthropist David Bassau founded Maranatha Trust and first used it to give loans in Indonesia in 1977. He came on staff with IIDI as the director of the Indonesia office in 1979 and began expanding its work in Asia. In 1988, IIDI changed its name to Opportunity International. Since that time, it has continued to grow.
Amid the weak economies and vast income gaps of the developing world, helping the poor find employment was nearly impossible. But the genius of microenterprise development was not in finding work, but in helping poor entrepreneurs create or expand their own businesses.
In 1992, Opportunity International began to focus on serving entrepreneurs at even lower levels of poverty. The Philippines program began to test the Trust Group lending method, and the Women’s Opportunity Network was formed and started to test and refine the Trust Group loan program across countries and cultures. Through small loans and business training, one person after another could begin to reverse the downward spiral of poverty and become providers for their families and leaders in their communities.
Convinced that no one group can tackle the issues of poverty alone, Opportunity began developing partners in various regions around the world-independent, self-governing organizations with a similar heartbeat. Linked together in 1998 as the Opportunity International Network-they now number 42 organizations in more than 20 developing countries with support partners in five countries (Australia, United States, Canada, United Kingdom, and Germany).
In 2000, Opportunity launched into what would become another distinction of its heritage. With more than 200,000 clients worldwide, Opportunity began establishing formal financial institutions (FFI) to broaden the financial services it can provide. FFIs take the form of commercial banks, development banks or credit unions and can accept deposits, borrow money and accept investments.
In 2002, Opportunity International began offering microinsurance through its subsidiary MicroEnsure. As the world’s first microinsurance intermediary, MicroEnsure provides protection against the many risks faced by those living in poverty. Innovative products cover policyholders with crop, health and life insurance–offering clients a safety net when an unexpected hardship or disaster occurs. With average premiums of about $1.50 per month for a family of five, MicroEnsure is making affordable life insurance available for the first time, exclusively to people living in poverty. Other innovations include policies covering persons infected with HIV/AIDS, weather-indexed crop insurance for rural farmers and affordable health insurance for the economically marginalized. MicroEnsure currently offers insurance in five countries. The Bill & Melinda Gates Foundation has provided a generous grant to enable the agency to enter new countries and provide insurance to many more people.
On 24 January 2006, David Bassau gave the 10th Australia Day Address (http://www.australiaday.com.au/whatson/australiadayaddress2.aspx?AddressID=5) with the subject “A Giving Nation.”
In January 2008, David Bassau was named Senior Australian of the Year 2008. The esteemed awards recognize Australians excellence-citizens who have made a substantial contribution to the country and are considered inspirational role models for the Australian community. David was recognized for the significant role he has played in the global fight against poverty through his contribution to the world of microfinance.
Opportunity International Australia also provides support services to its loan recipients such as business training, financial literacy training and community development initiatives. It currently works in India
, Indonesia
and the Philippines
by funding and supporting local microfinance institutions. These services include loans, savings, fund transfers and insurance
. Opportunity International Australia has a repayment rate of 97%. Opportunity International is a signatory to ACFID
.
In 2008, Opportunity International Australia's founder David Bussau
was recognised for his long-standing contribution to poverty alleviation by being named Senior Australian of the Year
2008.
), 2010 and are scheduled to arrive in Perth on 29 May 2010.
Opportunity International Canada raises funds and awareness for microfinance services provided by their affiliate organizations in the developing world, with a particular focus on Colombia
, Ghana
, Mozambique
, Malawi
and Rwanda
. There are plans for future expansions as Opportunity International Canada continues to grow.
In addition to a National Office in Toronto, Opportunity International Canada has staff members in Vancouver, Montréal and London, as well as a significant volunteer base in Alberta.
Starting in 2009, Opportunity International Canada staff and volunteers created programs and initiatives like Faces of Opportunity, MarketDay, Young Ambassadors for Opportunity, and OI Connect to raise funds and awareness across Canada. Faces of Opportunity is a small coffee table book of microfinance client stories. MarketDay is a program in schools, churches, and clubs which aims to involve and educate young people with the microfinance and entrepreneurship. The Young Ambassadors for Opportunity, or YAO, is an organized group of young professionals ages 18–35 who aim to raise awareness and funds for microfinance projects around the world. In 2010, Opportunity International Canada introduced OIConnect. OIConnect is a grassroots social media platform for supporters to create their own fundraising projects.
Further, one of the least remarked-on problems facing the world's poor living on two dollars a day is that they do not literally get that amount each day. In other words, economic poverty is not just a matter of low incomes, but also of irregular and uncertain incomes. To put food on the table every day and meet other basic consumption needs, poor households have to save and borrow constantly. One research team presented results of year-long financial diaries collected about twice a month from hundreds of rural and urban households in India, Bangladesh, and South Africa. They consistently found the poor use credit and savings to smooth consumption, to deal with emergencies like health problems and to accumulate the larger sums they need to seize opportunities--occasionally business opportunities--and pay for big-ticket expenses like education, weddings and funerals. Over the year, the average diary household used 8 to 10 different types of financial instruments; most types were used multiple times. The notion that microcredit brings loans to people who previously had no access to them is widespread but mistaken, as is the notion that the strong majority of microloans are used for business purposes.
Finally, it seems unlikely that a year of microlending helps poor people as much as a year of girls' primary education, for example. The true advantage of microfinance is not that each "dose" is more powerful, but rather that each dose costs much less than subsidies. Social programs like primary education and health care usually require large continuing subsidies, using up scarce tax dollars year after year. Microfinancing is different: when it is done right, relatively small up-front subsidies lead to permanent institutions that can continue providing services year after year with no further subsidy needed, and can expand those services to reach many millions of low-income clients.
These research findings show that the tangible benefits achieved by microfinancing, like religion, are a matter of faith, not fact. For the billions who cope with irregular and uncertain daily income, however, OIs family of microfinancing tools are among the wider menu of financial instruments that help provide reliable sources of income. OIs publications indicate almost all borrowers repay their microloans, so they will be able to continue accessing this funding source. For those who have faith in the eventual benefits of such outreach programs as microfinancing, OIs business model is a small but growing beacon of light in the developing world.
Small business
A small business is a business that is privately owned and operated, with a small number of employees and relatively low volume of sales. Small businesses are normally privately owned corporations, partnerships, or sole proprietorships...
loans, savings, insurance and training to more than two million people working their way out of poverty in the developing world. It serves clients in more than 20 countries and works with fundraising partners in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, Australia
Australia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...
, Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
, Germany
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
and the United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
.
Opportunity is a Christian
Christianity
Christianity is a monotheistic religion based on the life and teachings of Jesus as presented in canonical gospels and other New Testament writings...
organization whose work is motivated by "Jesus Christ’s call to love and serve the poor," while serving all its clients regardless of their race, religion, ethnicity or gender. Opportunity was founded in 1971 by Al Whittaker
Al Whittaker
Al Whittaker founded the non-profit organization Opportunity International and helped to popularize microcredit lending....
, former president of Bristol Myers International Corporation in America, and Australian entrepreneur David Bussau
David Bussau
David Bussau AM is a pioneer of microfinance, having founded Opportunity International Australia and co-founded the Opportunity International Network...
. They established the organization, seeking a solution to extreme poverty
Poverty
Poverty is the lack of a certain amount of material possessions or money. Absolute poverty or destitution is inability to afford basic human needs, which commonly includes clean and fresh water, nutrition, health care, education, clothing and shelter. About 1.7 billion people are estimated to live...
that would transform people’s lives while empowering them to financial independence and sustainability. Opportunity was one of the first nonprofit organizations to recognize the benefits of providing small business loans as capital to those working their way out of poverty, initially distributing these loans via the Trust Group model.
Trust Groups
In 1991, a group of Opportunity supporters formed the Women’s Opportunity Network (WON) and created an innovative group-lending methodology called the Trust Group. A typical first point of entry, the Trust Group joins together 10 to 30 entrepreneurEntrepreneur
An entrepreneur is an owner or manager of a business enterprise who makes money through risk and initiative.The term was originally a loanword from French and was first defined by the Irish-French economist Richard Cantillon. Entrepreneur in English is a term applied to a person who is willing to...
s who elect leaders and pledge to guarantee each other’s loans. Because the group guarantee replaces the need for collateral
Collateral (finance)
In lending agreements, collateral is a borrower's pledge of specific property to a lender, to secure repayment of a loan.The collateral serves as protection for a lender against a borrower's default - that is, any borrower failing to pay the principal and interest under the terms of a loan obligation...
, credit becomes available to those previously excluded from formal financial services. Each week, as Trust Groups gather to repay their loans, Opportunity provides educational sessions to develop business skills and enhance personal growth. In 2009, almost 1.2 million clients received transformative training on a wide range of topics.
Local staffing
Today, Opportunity recruits and develops staff from the countries it serves. Its global team has grown to over 10,000 employees, with nearly 6,000 loan officers working directly with microfinanceMicrofinance
Microfinance is the provision of financial services to low-income clients or solidarity lending groups including consumers and the self-employed, who traditionally lack access to banking and related services....
clients. By providing professional training, the opportunity for advancement and competitive pay and benefits, Opportunity is equipping local staff to become leaders in building the economies of their own communities. Opportunity's states its four core values as respect, commitment to the poor, integrity and stewardship. It strives to have these values exemplified in its worldwide staff in relating to clients, colleagues, donors, visitors, vendors and all people.
Technology
Technology is a critical tool in Opportunity International’s fight against poverty. Over the last 10 years, Opportunity has invested more than $20 million in electronic and mobile technology to reduce transaction costs and bring services to the most marginalized and remote people. Satellite branches and mobile banks reach clients in previously unserved areas, like rural farming villages and sprawling urban markets. Biometric technology provides convenient and secure access to finances, even for those who are illiterate or lack formal identification. Convenient ATMAutomated teller machine
An automated teller machine or automatic teller machine, also known as a Cashpoint , cash machine or sometimes a hole in the wall in British English, is a computerised telecommunications device that provides the clients of a financial institution with access to financial transactions in a public...
s and point-of-sale (POS) devices offer the only safe method for transactions in many markets. Cell phone technology gives clients in remote locations affordable, reliable access to their accounts. Grants from Omidyar Network and Credit Suisse help support Opportunity’s “electronic wallet” strategy.
History
In 1971, Al Whitaker left his job as president of Bristol Myers to found the Institute for International Development Incorporated (IIDI), a micro-enterprise organization. Barry Harper was IIDI’s first Executive Director and, along with development officer Dan Swanson, oversaw establishment of offices in ColombiaColombia
Colombia, officially the Republic of Colombia , is a unitary constitutional republic comprising thirty-two departments. The country is located in northwestern South America, bordered to the east by Venezuela and Brazil; to the south by Ecuador and Peru; to the north by the Caribbean Sea; to the...
, Peru
Peru
Peru , officially the Republic of Peru , is a country in western South America. It is bordered on the north by Ecuador and Colombia, on the east by Brazil, on the southeast by Bolivia, on the south by Chile, and on the west by the Pacific Ocean....
, Honduras
Honduras
Honduras is a republic in Central America. It was previously known as Spanish Honduras to differentiate it from British Honduras, which became the modern-day state of Belize...
, Kenya
Kenya
Kenya , officially known as the Republic of Kenya, is a country in East Africa that lies on the equator, with the Indian Ocean to its south-east...
, the Dominican Republic
Dominican Republic
The Dominican Republic is a nation on the island of La Hispaniola, part of the Greater Antilles archipelago in the Caribbean region. The western third of the island is occupied by the nation of Haiti, making Hispaniola one of two Caribbean islands that are shared by two countries...
and Indonesia
Indonesia
Indonesia , officially the Republic of Indonesia , is a country in Southeast Asia and Oceania. Indonesia is an archipelago comprising approximately 13,000 islands. It has 33 provinces with over 238 million people, and is the world's fourth most populous country. Indonesia is a republic, with an...
.
Australian philanthropist David Bassau founded Maranatha Trust and first used it to give loans in Indonesia in 1977. He came on staff with IIDI as the director of the Indonesia office in 1979 and began expanding its work in Asia. In 1988, IIDI changed its name to Opportunity International. Since that time, it has continued to grow.
Amid the weak economies and vast income gaps of the developing world, helping the poor find employment was nearly impossible. But the genius of microenterprise development was not in finding work, but in helping poor entrepreneurs create or expand their own businesses.
In 1992, Opportunity International began to focus on serving entrepreneurs at even lower levels of poverty. The Philippines program began to test the Trust Group lending method, and the Women’s Opportunity Network was formed and started to test and refine the Trust Group loan program across countries and cultures. Through small loans and business training, one person after another could begin to reverse the downward spiral of poverty and become providers for their families and leaders in their communities.
Convinced that no one group can tackle the issues of poverty alone, Opportunity began developing partners in various regions around the world-independent, self-governing organizations with a similar heartbeat. Linked together in 1998 as the Opportunity International Network-they now number 42 organizations in more than 20 developing countries with support partners in five countries (Australia, United States, Canada, United Kingdom, and Germany).
In 2000, Opportunity launched into what would become another distinction of its heritage. With more than 200,000 clients worldwide, Opportunity began establishing formal financial institutions (FFI) to broaden the financial services it can provide. FFIs take the form of commercial banks, development banks or credit unions and can accept deposits, borrow money and accept investments.
In 2002, Opportunity International began offering microinsurance through its subsidiary MicroEnsure. As the world’s first microinsurance intermediary, MicroEnsure provides protection against the many risks faced by those living in poverty. Innovative products cover policyholders with crop, health and life insurance–offering clients a safety net when an unexpected hardship or disaster occurs. With average premiums of about $1.50 per month for a family of five, MicroEnsure is making affordable life insurance available for the first time, exclusively to people living in poverty. Other innovations include policies covering persons infected with HIV/AIDS, weather-indexed crop insurance for rural farmers and affordable health insurance for the economically marginalized. MicroEnsure currently offers insurance in five countries. The Bill & Melinda Gates Foundation has provided a generous grant to enable the agency to enter new countries and provide insurance to many more people.
On 24 January 2006, David Bassau gave the 10th Australia Day Address (http://www.australiaday.com.au/whatson/australiadayaddress2.aspx?AddressID=5) with the subject “A Giving Nation.”
In January 2008, David Bassau was named Senior Australian of the Year 2008. The esteemed awards recognize Australians excellence-citizens who have made a substantial contribution to the country and are considered inspirational role models for the Australian community. David was recognized for the significant role he has played in the global fight against poverty through his contribution to the world of microfinance.
Annual report
| Annual Report 2009 | |
|---|---|
| Active Loan Clients | 1,357,828 |
| Savings Accounts | 562,101 |
| Microinsurance Policyholders | 1,016,507 |
| Average First Loan | $138 |
| Loans to Women | 84% |
| Loan Repayment Rate | 95% |
| Total Staff Worldwide | 11,501 (99% of whom are nationals) |
| Loan Officers | 6,515 |
| Assets | $567 million, including a loan portfolio of $388 million |
| Clients receiving business and personal training | 1,183,207 |
Opportunity International Network
Opportunity International was the first organization to approach microfinance using a microfinance network. The global Opportunity International Network includes the United States, Australia, Canada, Germany, and the United Kingdom.Australia
Opportunity International Australia is a part of the global Opportunity International Network.Opportunity International Australia also provides support services to its loan recipients such as business training, financial literacy training and community development initiatives. It currently works in India
India
India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...
, Indonesia
Indonesia
Indonesia , officially the Republic of Indonesia , is a country in Southeast Asia and Oceania. Indonesia is an archipelago comprising approximately 13,000 islands. It has 33 provinces with over 238 million people, and is the world's fourth most populous country. Indonesia is a republic, with an...
and the Philippines
Philippines
The Philippines , officially known as the Republic of the Philippines , is a country in Southeast Asia in the western Pacific Ocean. To its north across the Luzon Strait lies Taiwan. West across the South China Sea sits Vietnam...
by funding and supporting local microfinance institutions. These services include loans, savings, fund transfers and insurance
Insurance
In law and economics, insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the...
. Opportunity International Australia has a repayment rate of 97%. Opportunity International is a signatory to ACFID
ACFID
The Australian Council For International Development is an independent national association of Australian non-government organisations working in the field of international aid and development....
.
In 2008, Opportunity International Australia's founder David Bussau
David Bussau
David Bussau AM is a pioneer of microfinance, having founded Opportunity International Australia and co-founded the Opportunity International Network...
was recognised for his long-standing contribution to poverty alleviation by being named Senior Australian of the Year
Australian of the Year
Since 1960 the Australian of the Year Award has been part of the celebrations surrounding Australia Day , during which time the award has grown steadily in significance to become Australia’s pre-eminent award. The Australian of the Year announcement has become a very prominent part of the annual...
2008.
Fundraising initiatives
Macro For Micro is a campaign to raise the awareness of microfinance development. It consists of a team of Canadian cyclists that will be travelling 5,600 km from Sydney, Australia to Perth, Australia along the southern coast. The campaign is aiming to raise A$50,000 for Opportunity Australia to fight poverty. They departed Sydney on March 8 (International Women's DayInternational Women's Day
International Women's Day , originally called International Working Women’s Day, is marked on March 8 every year. In different regions the focus of the celebrations ranges from general celebration of respect, appreciation and love towards women to a celebration for women's economic, political and...
), 2010 and are scheduled to arrive in Perth on 29 May 2010.
Canada
Opportunity International Canada is also part of the global Opportunity International Network. One of the more recent members in the Network, Opportunity International Canada began in 1998, when a dedicated group of entrepreneurial Canadian business people rallied to launch it as a registered charity in Canada. Paula Curtis is the current CEO.Opportunity International Canada raises funds and awareness for microfinance services provided by their affiliate organizations in the developing world, with a particular focus on Colombia
Colombia
Colombia, officially the Republic of Colombia , is a unitary constitutional republic comprising thirty-two departments. The country is located in northwestern South America, bordered to the east by Venezuela and Brazil; to the south by Ecuador and Peru; to the north by the Caribbean Sea; to the...
, Ghana
Ghana
Ghana , officially the Republic of Ghana, is a country located in West Africa. It is bordered by Côte d'Ivoire to the west, Burkina Faso to the north, Togo to the east, and the Gulf of Guinea to the south...
, Mozambique
Mozambique
Mozambique, officially the Republic of Mozambique , is a country in southeastern Africa bordered by the Indian Ocean to the east, Tanzania to the north, Malawi and Zambia to the northwest, Zimbabwe to the west and Swaziland and South Africa to the southwest...
, Malawi
Malawi
The Republic of Malawi is a landlocked country in southeast Africa that was formerly known as Nyasaland. It is bordered by Zambia to the northwest, Tanzania to the northeast, and Mozambique on the east, south and west. The country is separated from Tanzania and Mozambique by Lake Malawi. Its size...
and Rwanda
Rwanda
Rwanda or , officially the Republic of Rwanda , is a country in central and eastern Africa with a population of approximately 11.4 million . Rwanda is located a few degrees south of the Equator, and is bordered by Uganda, Tanzania, Burundi and the Democratic Republic of the Congo...
. There are plans for future expansions as Opportunity International Canada continues to grow.
In addition to a National Office in Toronto, Opportunity International Canada has staff members in Vancouver, Montréal and London, as well as a significant volunteer base in Alberta.
Starting in 2009, Opportunity International Canada staff and volunteers created programs and initiatives like Faces of Opportunity, MarketDay, Young Ambassadors for Opportunity, and OI Connect to raise funds and awareness across Canada. Faces of Opportunity is a small coffee table book of microfinance client stories. MarketDay is a program in schools, churches, and clubs which aims to involve and educate young people with the microfinance and entrepreneurship. The Young Ambassadors for Opportunity, or YAO, is an organized group of young professionals ages 18–35 who aim to raise awareness and funds for microfinance projects around the world. In 2010, Opportunity International Canada introduced OIConnect. OIConnect is a grassroots social media platform for supporters to create their own fundraising projects.
Operating partners
Opportunity International serves more than 20 countries in Africa, Asia, Eastern Europe and Latin America. In 2010, its current funding priorities are: Colombia, the Democratic Republic of Congo, Ghana, India, Kenya, Malawi, Mexico, Mozambique, Philippines, Rwanda, South Africa, Tanzania, and Uganda.Efficacy of Microfinancing
There is no evidence presented in Opportunity International (OI) publications of summary-level improvements in household income or jobs created by OI's borrowers. This is not surprising, since scientific testing of the impact of microcredit is suprisingly difficult. Dozens of studies have looked at the experience of people who received microloans. The challenge has been to identify a control group for comparison: it is difficult and expensive to find a group of people who are like the loan recipients in all relevant ways except for not having gotten a loan. Two studies looked at standard microcredit clients over a short period (12-18 months) using randomized controlled trials found no evidence of improvements in household income or consumption. For now, it seems an honest summary of the evidence to say that we simply do not know yet whether microcredit or other forms of microfinance are helping to lift millions out of poverty.Further, one of the least remarked-on problems facing the world's poor living on two dollars a day is that they do not literally get that amount each day. In other words, economic poverty is not just a matter of low incomes, but also of irregular and uncertain incomes. To put food on the table every day and meet other basic consumption needs, poor households have to save and borrow constantly. One research team presented results of year-long financial diaries collected about twice a month from hundreds of rural and urban households in India, Bangladesh, and South Africa. They consistently found the poor use credit and savings to smooth consumption, to deal with emergencies like health problems and to accumulate the larger sums they need to seize opportunities--occasionally business opportunities--and pay for big-ticket expenses like education, weddings and funerals. Over the year, the average diary household used 8 to 10 different types of financial instruments; most types were used multiple times. The notion that microcredit brings loans to people who previously had no access to them is widespread but mistaken, as is the notion that the strong majority of microloans are used for business purposes.
Finally, it seems unlikely that a year of microlending helps poor people as much as a year of girls' primary education, for example. The true advantage of microfinance is not that each "dose" is more powerful, but rather that each dose costs much less than subsidies. Social programs like primary education and health care usually require large continuing subsidies, using up scarce tax dollars year after year. Microfinancing is different: when it is done right, relatively small up-front subsidies lead to permanent institutions that can continue providing services year after year with no further subsidy needed, and can expand those services to reach many millions of low-income clients.
These research findings show that the tangible benefits achieved by microfinancing, like religion, are a matter of faith, not fact. For the billions who cope with irregular and uncertain daily income, however, OIs family of microfinancing tools are among the wider menu of financial instruments that help provide reliable sources of income. OIs publications indicate almost all borrowers repay their microloans, so they will be able to continue accessing this funding source. For those who have faith in the eventual benefits of such outreach programs as microfinancing, OIs business model is a small but growing beacon of light in the developing world.
See also
- List of non-governmental organizations in the People's Republic of China
- Grameen BankGrameen BankThe Grameen Bank is a microfinance organization and community development bank started in Bangladesh that makes small loans to the impoverished without requiring collateral...