Opportunity International (OPIN), one of the world's largest nonprofit microfinance organizations is making a lasting difference in the lives of more than 812,000 poor entrepreneurs in Africa, Asia, Eastern Europe and Latin America. OPIN offers small business loans, training in basic business practices, insurance benefits, savings services, HIV/AIDS education and counseling in personal development that are proving to be viable, long-term tools for helping poor people work their way out of chronic poverty.
OPIN loans are repaid and recycled reaching out again and again to more poor entrepreneurs. Charging clients interest at local market rates allows OPIN programs to become self-sustainable.
OPIN's best practice model for microfinance is its innovative group-lending methodology: the Trust Bank. Developed by OPIN's Women's Opportunity Fund, a Trust Bank is a group of 15-40 poor entrepreneurs who receive small business loans and meet weekly to make loan repayments, address community concerns and receive business and personal development training.
The average first-time loan for a Trust Bank member is $84 for a typical term of four to six months. After repaying one group loan, Trust Bank members are eligible to qualify for increasing loan amounts. Because Trust Bank members guarantee each other's loans, the repayment rate stands at 98 percent.
OPIN builds formal financial institutions (FFIs) to broaden its financial services to poor entrepreneurs. FFIs take the form of commercial banks, development banks or credit unions and can accept deposits, borrow money and accept investments. FFIs can borrow against their equity and sell equity shares, releasing more money for loans and operations. These FFIs are "microfinance banks for the poor" and are often regulated by the country's Central Bank.
OPIN's clients are poor, self-employed women and men who rely on microfinance as their main source of income. These individuals range from the very poor, to those who have some assets but remain marginalized from the mainstream economy and society. Of OPIN's total client base, 70% are Asian/Pacific Islander, 12% are African, 10% are Hispanic, and 6% are Caucasian. Also, 86% of OPIN's borrowers are women.
OPIN loans have provided more than 2 million jobs. Operating in 30 countries, its microfinance programs help people who are desperately poor. OPIN made loans (averaging $84 for a first time group-loan), totaling $345.6 million to its 810,000 loan clients in 2005. This was an increase of 42% from 2004. OPIN loans increase small business's profits by as much as 40% in the first year of their implementation and borrowers increase their personal incomes by an average of 25% with their first loan. More than $1 million was raised in 2004 for Women's Opportunity projects.
Beatrice Kitaara and her husband are small Ugandan farmers who struggled for years to feed their nine children. After two loans from Opportunity International, Beatrice was empowered with the means to plant more crops and also buy a cow to ensure a steady income. The milk and additional produce provide a nutritious diet that keeps her family healthy and free from anxiety about hunger. Beatrice can now expect to send all her children through school. Full Story