Global Partnerships’ first Social Investor Forum draws 175 to hear about track record in microfinance investing
June 11, 2010 No Comments
Bellevue, WA – On Tuesday, June 8, a crowd of 175 people gathered at the Meydenbauer Center in Bellevue, Washington, to hear about Global Partnerships’ track record with microfinance investment funds, a business strategy that has allowed the nonprofit microfinance lender to increase its impact on people living in poverty while giving a fixed-income-return to a growing market of social investors.
The Social Investor Forum, a free public event that was the first of its kind, featured Global Partnerships president and CEO Rick Beckett and board president Dean Allen. The organization’s leaders reviewed the results and impact of the three microfinance investment funds that Global Partnerships (GP) has created since 2005.
Key topics covered at the event included:
- How Global Partnerships’ funds work–including the flow of capital from investors in GP funds to microfinance organizations (MFIs) to microloan borrowers and back again to investors.
- Results to date: Since 2005, Global Partnerships’ capital invested in MFIs has grown from $2.5 million to $39 million; the number of borrowers reached through microfinance institutions has grown from 150,000 to 817,000; and the number of microfinance institution partners from 4 to 27. To date, GP has been repaid at a rate of 100 percent by its microfinance partners and has repaid investors at a rate of 100 percent.
- How GP investment funds help fill the need for microfinance in Latin America, where 94 million people live on less than $2 day and only 15 percent of those who could benefit from microfinance have access.
- Who invests in Global Partnerships funds: Beckett and Allen noted that GP funds are structured to appeal to a range of social investors, from foundations aiming to align their portfolios with their values to individual investors who like the fixed-income return and the business-like approach to alleviating poverty.
- How Global Partnerships manages risk, including an innovative fund structure that includes a philanthropic layer that absorbs risk for the investor; and a highly select portfolio of socially focused MFIs that combine a sustainable business model with a strong commitment to social impact.
GP’s focus on “social enterprise” microfinance institutions that reinvest their profits in their mission serves an increasingly important need in the microfinance industry, Beckett noted.
“We’re at a crossroads in the industry,” he said. “The majority of capital is flowing to commercial microfinance institutions, where the most vulnerable people often get left out and social innovation is undervalued. GP aims to help fill this capital gap by funding social enterprise microfinance institutions that reach underserved markets and drive innovation in areas like health, education and rural economic development.”
During the question-and-answer session, the leaders spoke about the next frontiers in microfinance, including collaborations—like the one GP recently launched with PATH and Pro Mujer—to help microfinance institutions sustainably offer services such as health programming or business training.
Founded in 1994, Global Partnerships (GP) is a Seattle-based nonprofit organization that expands opportunity for people living in poverty by investing in socially motivated microfinance institutions. With staff based in Seattle and Managua, as of March 31, 2010, GP had just under $39 million invested in 27 microfinance partner institutions in seven Latin American countries that together, serve 817,000 borrowers. www.globalpartnerships.org.
Media contact: Elisa Murray, 206-652-8795, 206-334-9893 (cell), emurray@globalpartnerships.org
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