MICROCAPITAL STORY: Oikocredit of the Netherlands Invests USD 6.4 Million in Latin American Microfinance Institutions

The Consultative Group to Assist the Poor (CGAP) recently reported Oikocredit, a Dutch cooperative investment fund, invested a total of USD 6.4 million in five microfinance institutions in Latin America. The largest investment was USD 4.4 million in loans to EDPYME Edyficar, a microfinance apex institution based in Santa Cruz Miraflores, Peru this past February 2008. Other investments in February went to Fundacion Campo of El Salvador (USD 1.05 million), Fundacion Ecuatoriana de Desarrollo (USD 500 thousand), Cooperativa San Antonio Ltd. of Nicaragua (USD 300 thousand), and Cooperativa de Servicios Multiples TEPEYAC also of Nicaragua (USD 200 thousand).

Oikocredit is a Dutch cooperative investment fund comprised of church groups, social support groups, and individual investors. Established in 1975, Oikocredit invests in MFIs, small businesses and cooperatives with 637 projects worldwide in 37 focus countries. Oikocredit’s investments are largely successful, with loan loss of less than ten percent, throughout their 33 years of activity. The fund has USD 455.8 million in assets as of December 2006, with USD 131.7 million allocated for investments in microfinance institutions in the next twelve months.

EPDYME Edyficar is a non-bank financial institution based in Peru. Established in 1997 by CARE Peru, a non-profit international aid organization, EPDYME Edyficar focuses on micro-entrepreneurs and small businesses, providing financial services in the form of loans to be used towards working capital, equipment, machinery, construction, vehicle insurance, and other business-related expenses. Currently, EPDYME Edyficar serves over 137 thousand active borrowers and has a total loan portfolio of USD 127.9 million. Their total assets at the end of 2007 were reported at USD 152.9 million. EPDYME Edyficar’s return on assets (ROA) as of December 2006 was reported at 5.05 percent with a return on equity (ROE) of 30.27 percent.

Fundacion Campo provides financial and non-financial services to micro-enterprises and small businesses in both rural and urban areas of El Salvador. Established in 1996 as a non-profit organization, Fundacion Campo focuses on social and economic sustainable development. As of December 2006, their total assets were reported at USD 3.3 million with a return on assets (ROA) of 4.86 percent and a return on equity (ROE) of 6.39 percent. They currently serve nearly three thousand active borrowers with a total loan portfolio of USD 2.7 million.

Founded in 1984, Fundacion Ecuatoriana de Desarrollo (FED) is a non-profit microfinance institution based in Ecuador, targeting microentrepreneurs. Though their main service is micro-credit, the institution also provides training, counseling, health and marketing services for clients, promoting economic and social development. As of December 2006, FED had USD 13 million in total assets with over 14 thousand active borrowers and a total loan portfolio of USD 9 million. Their return on assets (ROA) for 2006 was -1.49 percent with a return on equity (ROE) of -2.55 percent as reported by The MixMarket.

Cooperativa San Antonio Ltd (CSA) was established in 1993 in Southern Nicaragua by the Wisconsin Coordinating Council on Nicaragua (WCCN) and the Nicaraguan Council of Protestant Churches (CEPAD) with USD 5 thousand in seed capital. CSA provides credit and savings services in rural areas focusing on the region’s meat and dairy industries. Current financial data was not available.

Cooperativa de Servicios Multiples (TEPEYAC) is a Nicaraguan rural cooperative that provides microfinance services including marketing support to local dairy farmers. The institution offers technical and financial assistance to strengthen the Nicaraguan dairy industry. Current financial data was not available. TEPEYAC is also supported by the Inter-American Foundation, a United States government agency that promotes sustainable development in Latin America and the Caribbean.

By Melissa Duscha

Additional Resources:

The Consultative Group to Assist the Poor (CGAP)

The Consultative Group to Assist the Poor (CGAP) recent list of transactions

EPDYME Edyficar

EDPYME Edyficar Mix Market Profile

Fundacion Campo

Fundacion Campo Mix Market Profile

Fundacion Ecuatoriana de Desarollo

Inter-American Foundation 2007 Budget PDF

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