Published: January 2011
The organizations listed below are microfinance institutions that provide loans, and in some cases other financial services, to clients in developing countries. In total we considered 114 institutions which stood out for submitting a social performance report to Mix Market (out of over 1,400 institutions listed on Mix Market), and contacted 43 promising ones. 11 of these provided us with enough information to complete a full review. We identified these organizations through our process for identifying promising microfinance charities. For reference, see our discussion on drop out, interest, and repayment rates, and how we interpret standard of living data.
|Organization||Rank (within cause)||Focus on dropout||Interest rates (monthly/APR/EIR)||Repayment rate (Collection rate/PAR>30/Write-off)||Clients' standard of living||Room for more funds|
|Small Enterprise Foundation||1||Excellent||7% / 84% / 126%***||99%*** / 1% / 1%||Very poor**||$1.1m for lending programs|
|Chamroeun||2||Above average||4-5% / 51-61% / 65-81%***||99%*** /||Poor***||$564k for lending and non-lending|
|CUMO||3||Above average||13% / 156% / 354%***||N/A / 3% / 0%||Poor*||Possible for lending programs|
|MicroLoan Foundation||4||Moderate||12% / 144-149% / 304-326%**||98%*** /||Very poor*||$600k for lending programs|
|ID-Ghana||5||Limited||Not asked (see note below)||N/A / 4% / 27%||Very poor**||For lending programs|
|DAMEN||-||Moderate||3% / 35% / 41%**||N/A / 5% / 2%||Less poor*||$520k for lending programs|
|FMFB||-||Limited||Insufficient information||N/A / 1% / 1%||Less poor*||$1m for lending and non-lending|
|FINCA Peru||-||Moderate||69-80% "effective" annual interest*||N/A / 2% / 1%||Less poor*||Possible for non-lending programs|
|Fundación Paraguaya||-||Moderate||Insufficient information||N/A / 6% / 3%||Less poor*||Not for lending programs|
|MicroDreams||-||Limited||Insufficient information||Not explored due to other remaining questions||We have not seen information on this||About $1m for lending programs|
|Progresar||-||Unknown||10-13% / 128-151% / 237-341%*||N/A / 5% / 2%||We have not seen information on this||$101,000 for lending programs|
|AMK||-||Strong||3% / 30-37% / 34-45%***||97%* / 3% / 0%||Poor**||Likely does not need additional donations|
- PAR>30 and write-off ratios are not given quality ratings because they are all taken directly from Mix Market, and thus we are not aware of any variation in quality. They are for the most recent year for which data is available (2008 or 2009). They do not describe the current portfolio of any MFI.
- For more information on what we mean by a "collection rate," see our blog post, "More on the microfinance repayment rate."
- For more information on different methods for calculating interest rates, see our post, "Microfinance interest rates."
- For more information on the standard of living information we used for each MFI, see this excel file.
- We didn't ask ID-Ghana for information on their interest rates. At the time we reviewed them (late-2009), interest rates were not a key step in our process.
- AMK appears strong on all factors we investigated (to the extent we investigated them), but informed us that it was recently sold to an equity fund, and it is therefore unclear to us what role donations will play in AMK's operations in the future. Note that AMK is listed as one of Kiva's largest partners,1 and likely “effectively” receives donations through that vehicle (since it charges substantial interest while not paying interest in Kiva loans).
U.S.-based microfinance charities
We have considered the following U.S.-based microfinance charities. As discussed on our blog, these are large organizations that partner with a variety of microfinance institutions in developing countries. With the exception of Kiva, most of their activities consist of consulting or “technical assistance,” rather than founding, directly supporting or investing in microfinance institutions.
- Accion International
- FINCA International
- Grameen Foundation
- Opportunity International
- Women's World Banking