Social Capitalists: ACCION International
Year founded: 1961
CEO: María Otero
A world pioneer in microfinance, Boston-based nonprofit ACCION International was founded in 1961 and issued the first microloan in 1973 in Brazil. Since then, it has led the evolution from simple microloans to a full range of financial services for the self-employed poor such as savings, insurance, housing loans, and remittances.
In many developing countries, self-employment through microenterprise is the only means for people to provide for their families. Microenterprises represent an estimated 80% of total enterprises and 50% of urban enterprises in developing countries, where they are the main source of jobs for poor people. Despite their economic potential, the poor are too often “invisible” to banks and are excluded from the financial services they need to grow their businesses.
ACCION envisions a world in which financial systems work for the poor so that they have the same opportunities to create and grow businesses as those with higher incomes. By bringing financial services to people who have historically been ignored by banks, ACCION has helped inspire a whole new kind of banking: microfinance.
Microfinance is a unique solution to poverty that taps into the entrepreneurial spirit and will to succeed that exists for all people, regardless of their financial means. It is also a sustainable solution to poverty as the interest paid on each loan helps support other clients’ future loans.
By providing microloans, business training, and other financial services to poor women and men, ACCION partners help them work their way up the economic ladder with dignity and pride. With capital, people are able to grow their microenterprises and earn enough to afford basics like running water, better food, and schooling for their children. In addition to creating opportunity for their entire families, many microentrepreneurs are extraordinary examples of strength and perseverance, and this is creating lasting change for future generations throughout the world.
ACCION has played a key role in the launch, expansion, and success of more than 30 of the world’s leading microfinance institutions (MFIs). ACCION’s partner MFIs today are providing loans as low as $100 to poor entrepreneurs in 22 countries in Latin America, the Caribbean, Asia, and sub-Saharan Africa, and in more than 35 U.S. cities and towns. Together with its partner MFIs, ACCION has disbursed $9.4 billion in microloans to more than 3.97 million borrowers since 1996, with a historical repayment rate of 97%. In 2005 alone, ACCION helped put $2.6 billion in the hands of more than 1.8 million people. Sixty-five percent of these clients are women.
ACCION relies on public and private funding to reach microentrepreneurs through the creation of new microfinance institutions, the development of new products and services, geographic expansion and the extension of business training programs. In a world where 3 billion people live on less than $2 a day, it is not enough to help 1,000 or even 100,000 individuals. ACCION’s goal is to bring microfinance to millions of people—enough to truly change the world. Based on the success of its programs to date, ACCION has committed to vastly increasing the number and size of microfinance institutions worldwide. ACCION is on track to more than double the number of clients served by its network and partners by the end of 2008, which means reaching 3 million active clients annually.
To learn more, call (617) 625-7080.