Oikocredit
Oikocredit is an Investment Partner of the BiD Challenge.
Oikocredit is a co-operative financial institution that offers loans or investment capital for microfinance institutions, co-operatives and small and medium sized enterprises in developing countries. Oikocredit is privately financed; individuals and organisations invest in Oikocredit shares.
Started as a pioneer in the field of development financing, Oikocredit is today one of the largest private financiers of the microfinance sector worldwide. A network of offices, spread over Latin America, Asia, Africa, Central and Eastern Europe and managed by local professionals, ensures proper understanding of the local needs and realities, as well as a carefully balanced financing policy. Oikocredit also finances other kinds of income generating projects that ensure high social impact: such as cooperatives or small and medium enterprises (SMEs) involved in agriculture, trade, services and manufacturing.
Project funding criteria
Oikocredit deliberately assists groups, preferably not individuals, because this guarantees that more people benefit from a loan. Also the fact that Oikocredit lends substantial amounts of money makes Oikocredit financing mainly suitable for groups. Oikocredit reaches individuals at the grassroots of society indirectly, by financing microfinance institutions and cooperatives. Oikocredit observes the following criteria in considering projects for credit assistance:
- Oikocredit extends loans, guarantees and other type of financing to projects that create jobs and income for groups of disadvantaged people, mostly in developing countries.
- Oikocredit finances first and foremost cooperatives and finance institutions but also, to a lesser extent, small and medium-sized enterprises.
- Oikocredit favours projects where women are influential in management and/or implementation.
- Environmental implications of projects as well as animal welfare are issues of special concern.
- Only projects that are or can soon become financially sustainable and have suitable management in place are considered for financing.
- There must be a clear need for foreign investment which can be provided within terms that can secure the necessary government approvals and that are beneficial to the project partners.
Oikocredit and the BID challenge
Oikocredit and the BID challenge share a common objective: contributing to poverty alleviation by supporting business initiatives from the South. Oikocredit has a long history in supporting grassroots entrepreneurs initiative in developing countries. By providing credit for development over the past 30 years , it has proven that small entrepreneurs in developing countries are credit worthy and that business is an efficient motor for helping people to help themselves.
Role in the BID Challenge
In addition to financial support, Oikocredit's staff screens business plans.
