ACCION International, a pioneer and leader in microfinance, is pleased to announced that it has been ranked the No. 1 microfinance nonprofit globally by Philanthropedia, an organization devoted to improving and measuring nonprofit effectiveness.

To create its ranking, Philanthropedia surveyed 131 international microfinance experts, including foundation executives, researchers, nonprofit senior staff and government officials.  These experts identified 12 top microfinance nonprofits and rated them on the basis of impact in the field.  Of the 131, 57 agreed that ACCION had the most impact.

In their assessment, the experts cited the scalability and sustainability of the 34 microfinance organizations with whom ACCION partners; ACCION’s innovation in client protection, through its leadership role in the Smart Campaign for consumer protection; its commitment to serving excluded populations (evidenced by its new ventures in the Amazon, Inner Mongolia, Cameroon, and Bihar, India); and good governance.

Comments included:

• “They are good industry teachers, have good financial performance, are good in product development, and are pushing the frontiers in microfinance.”
• “They have a leading role in consumer protection.”
• “They have successful and sustainable microfinance institutions and are growing and serving excluded populations in different environments.”
• “They have impressive growth and sustainability.”
• “They are the founder of microfinance.”

“At the end of the day, we believe that the impact a nonprofit is having on the lives of the people it’s reaching is what’s most important,” said Erinn Andrews, Philanthropedia’s COO.  “We hope donors will reward ACCION for their superb efforts and other nonprofits will follow the good example they’re setting.”

“It’s particularly gratifying to be so highly considered by colleagues – those who are in the best position to assess the full range of our efforts to build double-bottom-line microfinance institutions,” said Michael Schlein, ACCION’s president and CEO.

About ACCION International
ACCION International is a private, nonprofit organization with the mission of giving people the financial tools they need — microenterprise loans, business training and other financial services — to help work their way out of poverty.  A world pioneer in microfinance, ACCION was founded in 1961 and issued its first microloan in 1973 in Brazil.  Over time, ACCION has helped build 62 microfinance institutions in 31 countries on four continents.  Those institutions are currently reaching 4.9 million clients.  In the United States, the U.S. ACCION Network is the largest microfinance network in the country and has served over 24,000 clients with nearly $277 million in loans since the inception of its pilot program in 1991.  For more information, visit ACCION

Here are the Top 5:

View the rest here.

For more information about the study, read the Research Report.

Source: PR Newswire.

I was reading a couple articles today about microfinance when I randomly came across CatchAFire.org. CatchAfire.org is a social business that is putting together a concept that a lot of people in the microfinance community have talked about.  Although CatchAFire doesn’t only serve to microfinance non-profits, it does reach out to quite a few of them.  I think it’s a great idea that will really help all sorts of non-profits.  Here’s some more info about CatchAFire:

Catchafire’s mission is to improve the quality of the volunteer experience by providing the opportunity for people to volunteer their skills in a powerful way.  Their vision is to make it easy for every professional to volunteer their skills if they want to and to make it easy for every nonprofit and social enterprise to access and effectively use skills-based volunteers.  They believe in providing efficient, effective, and meaningful volunteer experiences for both volunteers and the organizations with whom they work. They believe that a good volunteer experience can transform someone’s life, and also know that a bad one can turn someone away from giving their time forever.  Catchafire matches professionals who want to volunteer their skills with nonprofits and social enterprises that need their help. They match volunteers and organizations based on a variety of characteristics including skills, cause interests, and time availability.  They help organizations identify their needs as short-term, discrete, and individual-based projects. Our projects are structured in this way to make it easy for professionals to find time to volunteer in the midst of their busy daily lives. Check out our projects here.  They charge nonprofits and social enterprises less than 5% of the cost that they would normally pay for the professional services our volunteers provide. Our service is free for all professionals willing to donate their time. They also help corporations offer our skills-based volunteer opportunities for their employees.

Although CatchAFire reaches out to various non-profits, here’s a current list of the microfinance organizations that they work with:

They Often Cry Outreach
They Often Cry Outreach (TOCO) is a 501(c)(3), U.S.-based not-for-profit organization founded by St. Lucian artist Taj Weekes and is dedicated to improving the lives of underprivileged, at-risk and orphaned children in the Caribbean through sport, enrichment, educational and wellness…

MediaGlobal
MediaGlobal is an independent international media organization, based in the United Nations, creating awareness in the global media on social justice and development issues in the world’s least developed countries. Launched in 2006, MediaGlobal is a 501(c)3 media organization headquartered…

UNDP Equator Initiative
The Equator Initiative is a partnership that brings together the United Nations, governments, civil society, businesses, and grassroots organizations to build the capacity and raise the profile of local efforts to reduce poverty through the conservation and sustainable use of…

Network 355
Network 355 is a New York City based network of socially responsible women entrepreneurs who volunteer their expertise to raise public awareness about humanitarian and cultural causes. Mission: Network 355′s mission is to promote women as a powerful force for…

Barefoot MBA
Barefoot MBA aims to provide people with the knowledge they need to make better business decisions. The Barefoot MBA teaches business concepts to undereducated entrepreneurs through a collection of simple, contrasting stories. As students at the Stanford Graduate School of…

The ESB Group, LLC
MENASA Social Enterprise Consulting Co-founder of a privately held microfinance start-up and for-profit social enterprise (FPSE) geared towards economic development and poverty alleviation in Africa & South Asia. We specialize in offering social enterprise consulting and micro-equity, non-interest financing services…

Youth Challenge America
Youth Challenge America is a leading global youth development organization that promotes youth innovation to drive positive change. YCA is the American affiliate of Youth Challenge International based in New York city. Building on YCI’s more than 20 years of…

United Prosperity
United Prosperity helps you to combat poverty by multiplying the impact of your money through loan guarantees. We are the world’s first peer-to-peer loan guaranteeing website. How it works: Choose an Entrepreneur; Guarantee a loan; Get Repaid 1) You browse…

Operation HOPE
Operation HOPE, Inc. (HOPE) is a non-profit, public benefit organization, founded immediately following the civil unrest of April 29, 1992 in Los Angeles. HOPE is America’s leading provider of economic tools and services. HOPE is an effective facilitator, lender, advocate…

Global Cocoa Project
The Global Cocoa Project is a high impact poverty alleviation initiative that supports cocoa farmers around the globe by supplying them with the basic tools they need to improve the quality of their cocoa production. Additionally, basic needs will be…

PoverUP
PoverUP is a student grassroot movement created to raise student’s awareness on the power of microfinance in high schools and universities on a global scale. Dedicated to lifting people living on less than $2 a day out of poverty through…

Africa Volunteer Corps
Africa Volunteer Corps (AVC) is a Moshi-based NGO that will match Tanzanians with local, grassroots NGOs and provide stipends for the duration of their contract. The goal of Africa Volunteer Corps is to provide employment experience as well as travel…

ioby
ioby (eye-OH-be) stands for “in our backyards” and the belief that environmental knowledge, innovation, action, and service begin and thrive at the local level. We are a NYC-based nonprofit and, for now at least, NYC-focused. Our online platform combines the…

BRAC USA
BRAC USA shares the same mission and vision as BRAC. Our vision is a world free from all forms of exploitation and discrimination where everyone has the opportunity to realize their potential. Our mission is to empower people and communities…

Over the last couple of days, there have been a couple great articles about big microfinance organizations that I thought would be worth sharing:

Vittana Makes a Commitment at the Clinton Global Initiative Annual Meeting to Help 10,000 Students Across Africa Go to College.
NEW YORK, Sept. 23  /PRNewswire-USNewswire/ — Vittana is pleased to announce its Commitment To Action in the Education category, which will bring student-lending programs to Africa. The announcement was made at this week’s annual meeting.  Through its initiative, Vittana/Africa: Bringing Student Loans to Africa, Vittana will partner with some of Africa’s finest microfinance institutions to launch one of the first lending programs to specifically target young people, helping fund their post-secondary education. These loans will help 10,000 students complete the “last mile” of their education by the year 2015…[read more]

Grameen Foundation and YouChange Foundation Announce New Collaboration to Expand Microfinance Services in China
HONG KONG, Sept. 22  /PRNewswire-USNewswire/ — Grameen Foundation and the China Social Entrepreneurship Foundation (also known as YouChange Foundation) have formed a landmark collaboration designed to increase access to microfinance for millions of poor people in China. Beijing YouChange PuRong Information Advisory Co. Ltd. (YouChange PuRong) is a social business that represents a unique partnership between the development sector…[read more]

Kashi and Emergen-C Partner With Whole Foods
In an effort to raise money to fight global poverty, Kashi Co. and Emergen-C are partnering with Whole Foods Markets’ nonprofit Whole Planet Foundation. For every box of its new Emergen-C Planet…[read more]

ACCION USA Partners Up with Count Me In!
Those that know ACCION  USA know that we love to partner!  Strong partnerships are critical to advancing our mission of lending, supporting and inspiring small business owners.  Recently, we announced a new great partnership with Count Me In, a not-for-profit organization that aims to promote economic independence and the growth of women-owned businesses.  Count Me In, like ACCION USA believes that entrepreneurs thrive with a combination of access to financial resources, education and support…[read more]

I was talking to Bhalchander Vishwanath, the founder and CEO of United Prosperity, and he mentioned a couple big milestones that I wanted to highlight:

1) Guarantee Repayments
United Prosperity is ready to start the repayments on the guarantees. These repayments will be done every quarter. Most of people have already received the repayments which are now credited into their online account with UnitedProsperity.org.  Please recycle your funds to support more entrepreneurs and  make a difference to their lives.

2) 1000th Entrepreneur Got Funded
Since the launch in May 2009, United Prosperity has been growing steadily and, on August 27 2010, they funded their 1000th entrepreneur – Nirmani Devi and group from Bhavanipur. Read their stories here.

3) Crossed $200,000 in Loans
A few days later when Suchitra Devi and her group from Balidih got funded, United Prosperity crossed $200,000 in loans. Read their stories here.

Additionally Bhalchander wrote a post on their blog about the loan repayments.  He goes into details:

“We initiated repayments on loan guarantees this weekend and have returned nearly $20,000 in repayments to individual loan guarantors.  This is a major milestone for us. During repayments the amount of guarantee that is returned is proportional to the percentage repaid on the loan tranche from the bank to the microfinance institution. Thus in case of the earliest loans of June 2009 the repayment is around 40% of the guarantee amount, while for the latter loans in May/June 2010 the lowest repayment is around 9%. Loans in the intermediate period will have repayments between 9% and 40%. To many individual loan guarantors, the repayments are a validation of the guarantee model. There is also a validation of the guarantee model at the human impact level that I am most delighted to share. A year back at the peak of the financial crisis Ajiwika, our first microfinance partner was finding it very difficult to raise funds from banks. Based on United Prosperity’s guarantee support a large Indian bank agreed to lend a little over $200,000 over…[read more]“

If you haven’t been to their site and given a loan, check them out.

Davis, California — Freedom from Hunger has successfully completed a $6 million project funded by the Bill & Melinda Gates Foundation.  The four-year grant enabled Freedom from Hunger and five microfinance banks in Africa, Asia and Latin America to add health protection options to their financial offerings, reaching more than 1.5 million of the world’s rural poor in five countries: Benin, Bolivia, Burkina Faso, India and the Philippines.

“Microfinance is succeeding at putting money into the hands of poor people but too often ill health causes them to slip back down the ladder into poverty again,” said Chris Dunford, President of Freedom from Hunger.  “Our solution is to bring together the economic development and health sectors to develop practical and coordinated tools that have more power to create lasting change.”  The health programs included health savings, health loans, health insurance, health education, group discounts with health providers, mobile healthcare in rural villages, distribution of insecticide-treated mosquito nets, and more.

Freedom from Hunger conducted careful research and evaluation to determine the impacts of these innovative combinations of microfinance services and health programs.  In Bolivia, for example, 24 percent of clients said that they had never seen a doctor before participating in the program, and in India, the life-saving use of oral rehydration solution increased by 47 percent to treat children with diarrhea (a leading cause of death in local children).  In Benin, families in the program were 23 percent more likely to own an anti-malarial net.

“These are incredible outcomes after only a brief intervention period and they show that this work is having impact,” said Marcia Metcalfe, Director of Microfinance and Health Protection at Freedom from Hunger and former CEO of a U.S.-based health insurance company.  “Microfinance has enormous potential as a financially viable mechanism for reaching poor, rural people with simple but life-saving health protection services.”

Locally owned microfinance banks see increased returns when their clients are healthier and have more knowledge and options to protect their health.  Microfinance banks are typically commercial entities with a social mission, so they must earn enough profit in order to continue serving their clientele.  Freedom from Hunger, with the support of grant funds, can help microfinance banks improve efficiency as well as the impact of their products to better achieve their social and financial goals.

“Our experience has shown that well-established microfinance banks can offer valuable health-related options to their clients at low or no cost to the bank itself.  In fact, our research results indicate that, in some cases, the resulting increase in client attraction and loyalty may lead to a net financial gain for the banks,” said Myka Reinsch, Special Advisor at Freedom from Hunger.

Daouda Sawadogo, leader of one of the participating microfinance providers, RCPB in Burkina Faso, pointed out, “These services go a long way to addressing the needs of our clients and helping them overcome poverty—and if they can be offered at low or no marginal cost, then that is a double win.”

Participating microfinance institutions include Bandhan (India), CARD (Center for Agriculture and Rural Development, Philippines), CRECER (Crédito con Educación Rural, Bolivia), PADME (Projet d’Appui  au Développement des Microentreprises, Bénin), and RCPB (Réseau des Caisses Populaires du Burkina, Burkina Faso).

Freedom from Hunger has documented the processes and results of this innovative project in a series of white papers and how-to guides, and will be continuing to share them broadly.  Please visit http://www.ffhtechnical.org/resources/microfinance-health to learn more about microfinance and health protection programs.

Freedom from Hunger brings innovative and sustainable self-help solutions to the fight against chronic hunger and poverty.  The nonprofit organization’s 48 staff have trained and supported 72 partner organizations in 16 countries to deliver microfinance, education, and health protection services to more than two million women and families in Africa, Asia and Latin America.

Visit Freedom from Hunger for more info.

MicroRate just published their State of Microfinance Investment: The 2010 MicroRate MIV Survey that highlights the fact that, even with the recession and financial problems around the globe, interest in microfinance funds still remains strong.

Microfinance investment vehicles (MIVs) are a relatively new category of funds that mobilize investments in rich countries and channel them to microfinance institutions (MFIs) in the developing world. “The flow of funding through MIVs is one of the little noticed triumphs of development,” says Sebastian von Stauffenberg, CEO of MicroRate.

While MIVs’ assets continued to grow at a commendable 22% (2009) reaching over $6 billion, prior to the financial crisis, the annual rate of growth was 97% (2007). “Pre-crisis growth rates were not sustainable. MIVs now have an opportunity to strengthen their organizations and lending criteria, focusing on the needs of MFIs,” reflects Sebastian von Stauffenberg.

“While demand from microfinance investors remains, it is being met by weaker demand for funding from MFIs,” says Sebastian von Stauffenberg. “We’ve observed that MFIs tend to borrow from local funding sources first and MIV funding is used during peaks of growth. When MFI growth slows as it has in 2008 and 2009, demand for MIV funding decreases disproportionally. MIVs are now faced with notably higher levels of liquidity than previously observed due to this decrease in MFI’s need for funding.”

The significant increase in liquidity was exacerbated by lending to MFIs by public development finance institutions (DFIs). A liquidity-providing facility was announced by DFIs at the end of 2008, but by the time the funds were disbursed in mid-2009, there was no credit shortage to relieve and instead these funds displaced private funding. Damian von Stauffenberg, founder of MicroRate, comments “One would wish that DFIs were less intent on meeting their lending targets and more attuned to the needs of the institutions they are trying to help.”

You find find further details on MicroRate.com.

Last Friday, Unitus, which provides capital and expertise to microfinance institutions in developing countries, announced that it is closing its doors to its Seattle headquarters and is redirecting its efforts from non-profit microfinance to new social ventures.  This comes as a big suprise, as Unitus has directed $40 million in donations and $30 million in investment capital to microfinance partners over the last 10 years.  Joseph Grenny, chair of the board states:

“For the past decade, Unitus has been working to increase access to capital for the working poor, under the central premise that this vast, underserved segment of the world’s population was a good investment and could be well-served by commercial capital providers. We are gratified that this core belief has been validated—capital markets have embraced microfinance to the extent that there are tens of billions of dollars in microfinance capital now available annually, with additional providers entering the marketplace at an aggressive clip. We now feel that there is greater need for our capital and energy in other areas—which we are currently exploring—aligned with our overarching mission of alleviating poverty through opportunity.”

Ed Bland, the president and COO of Unitus said:

“The fact that we have become largely unnecessary in the microfinance arena is fantastic news and is a tribute to our generous, enlightened donors and the phenomenal staff at Unitus, who worked tirelessly to validate and refine the microfinance model, and advance the operations of our partners. Brigit Helms, our outgoing CEO, merits our gratitude for her outstanding leadership in surveying the global socio-economic landscape, evaluating future options for Unitus and working with the staff to assure that our partners are on solid footing. Outgoing members of the Unitus team can now leave with the assurance that they have contributed to a tremendous legacy of success here, prepared to make a continuing positive difference in the world.”

As Unitus transitions away from microfinance to other strategic areas, Geoff Woolley, a former Unitus board member, will serve as future CEO for the reinvented organization. Bland will remain in his role as acting President and COO. Helms will serve as a key advisor during the organization’s transition. The Unitus Board and executive team are currently considering various strategic opportunities, with the goal to maximize the socio-economic impact for those currently not being served in today’s marketplace.

Unitus has always been a big player in the microfinance industry, especially here in Seattle.  I’ve seen a couple of other news articles on the web with interviews from Unitus employees which all reiterate that Unitus is leaving microfinance in a positive light, and is not leaving a sinking ship.  It hasn’t been announced yet what the new social ventures that Unitus will be involved in are, but I am really eager to see what new initiative is drawing them away from microfinance.  Although it is a big loss having Unitus leave, as long as all of the press releases are true, it’s for the greater good.  I guess we’ll just have to wait and see…

Sources:
Seattle Times
Unitus


SKS Microfinance Ltd, one of the founding and largest microfinance institution based out of India has files its preliminary paperwork on the Indian Capital Market where it aims to raise about $250 million.  If they go IPO, this would make SKS the very first microfinance institution to go public.  Personally, I think this is great.  I’m sure there are pros and cons to this, and there will be people scrutinizing this decision, but I think it is a great idea to help raise money with an initial public offering.  When microfinance platforms first started, people loaned money without any incentives of making money.  Then microfinance platforms such as Microplace came along and gave investors and opening into microfinance.  The next step was donating to MFIs.  First it started with simple donations, but then Microfinance platforms like Dvelo.org came along that allow lenders to give to MFIs as well as entrepreneurs. I think that by SKS offering an IPO, it is the first step to the next level of the natural microfinance progression to gaining more access to capital.  It is going to be interesting to see what kind of reception this gets.
Read the entire Wall Street Journal article for for more details about SKS’s IPO preliminery prospectus.

World Vision recently launched their own Kive-like lending platform named Micro. They are the latest microfinance lending platform to launch, joining more established players such as Kiva, Wokai, and Microplace. It looks like the site was launched in September (also on UrbanMinistry), but I was made aware of the site from SocialEarth’s blog post today. According to their site, World Vision has disbursed 3,500,000 loans totaling more than $1.8 billion since 1993, has 604,000 active entrepreneurs, and loaned $396 million last year — so they are not new to microfinance by any means. Loan sizes range from $25 all the way up to $500+. Currently, Micro only offers loans for entrepreneurs in Rwanda, Mexico, and the Phillipines — but I’d guess they will be adding new markets in the coming year.

I’m certainly a fan of anything that brings microfinance into the spotlight and am thrilled that World Vision is tapping their existing donors to help raise capital for microfinance, but am yet to be convinced software development time and effort should continue to be spent on building technology to power lending platforms. As I said in August, I’d still like to see Kiva.org open source, or white-label, some of their software to other players in the market who want to specialize in a particular geographic area or type of business; that would enable development time and dollars to be spent building features on top of some of the great P2P lending technology that already exists.

For those interested in following Micro’s progress, you can follow them on Twitter here. Head over to SocialEarth for more details.

This month, the Grameen Foundation launched the Ingenuity Fund Challenge.  The Ingenuity Fund is a new program that inspires individuals to start their own fundraising efforts to help and inspire others to become a part of microfinance.  There are millions of people around the world who have ideas, with the Ingenuity Fund, Grameen is trying to tap into that resource.
From November 2009 through February 2010, Challenge participants will develop compelling, creative personal fundraising pages on Grameen Foundation’s website, and raise awareness of and funds for Grameen Foundation’s work through personal networks, social media and other offline activities.  By joining this campaign, not only are participants helping spread the awareness of microfinance, but the participant who has the most ingenious web page and outreach effort will travel abroad with the Grameen Foundation to visit one of their on-the-ground microfinance or technology programs. They’ll document the experience through blogging, photos and videos featured on the Grameen web site, giving a new voice to the global community that believes poverty is unnecessary.

Take the first step by creating a fundraising page!

Click here for the official rules