Doña Yolanda is an economic engine for twelve women artisans, a role model as a mother raising two children together with her husband, and an advocate for women’s health and family planning in her community.
Yolanda accomplished all of this despite significant barriers. She grew up in a household all too often characterized by rural poverty: a lack of electricity, formal education or financial opportunity.
Early in her childhood, Yolanda learned to weave from her mother, a common trade among indigenous Guatemalan women. She had a trade and was driven, and only needed an opportunity.
That opportunity came when she became a client of Friendship Bridge in Guatemala, a GP partner since 2013.
Today, Friendship Bridge helps 20,000 clients build resilience and pursue opportunities. They serve women, mostly in rural areas where poverty levels are highest. This commitment to inclusion is one of the cornerstones of GP’s investment strategy.
Another cornerstone is high-impact products and services. Friendship Bridge provides microfinance, education and preventive health services. This trio of services has proven to propel their clients forward by addressing poverty on multiple fronts.
Friendship Bridge has provided Yolanda with loans to support her business. She is the leader of her artisan cooperative in rural Quiché, Guatemala. Her home doubles as a bustling workshop for the twelve women artisans in her cooperative. They weave textiles on looms or embroider fajas—traditional belts—that they sell at tourist markets in Guatemala and export to the U.S.
“Even though I didn’t graduate from school and don’t have a real job title, I have meaning in my work. I love to make different designs and when I go to sell I feel happy because everyone says, ‘Wow, it is beautiful.’ I feel accomplished and happy. I am really proud that I am a weaver.”
While financial services equip Yolanda with capital to invest in her business, she attributes the financial education she received from Friendship Bridge with teaching her skills like budgeting to make the most of her loan.
The health services that Friendship Bridge provides are critical to Yolanda and her family to ensure her business can continue and her family is healthy and strong. She has also developed a passion for women’s health and family planning. Women in her community often have ten or more children. Yolanda has two – a daughter and a son – which she and her husband agreed upon. Yolanda lets women in her community know they have the right to decide how many children to have.
“What I want is for women to know they have worth and they have rights as women.”
Investing in Women: What Works?
By Tara Murphy Forde - VP, Impact & Research, Global Partnerships
Imagine that you are a woman living on a farm on the outskirts of a small, rural town in Bolivia. You wake before the sun rises to tend to the animals, cook buñuelos, feed your children and send the older ones off to school. You then spend the early morning managing the farm and the house - planting, tilling, washing, and cleaning, all by hand and often with your young one strapped to your back. You then make the two-hour journey, on foot and public transportation, into town to purchase supplies, in small amounts because that’s all you can carry and all you can afford. These supplies are for your modest business – selling buñuelos at the bus stop outside of town. You set up shop in the afternoon to sell the buñuelos you made that morning. You return home after sundown to prepare dinner over a wood stove, help your children with homework and get them to bed under the dim light of a kerosene lamp.
As a mother of two, I am familiar with the demands of juggling work, home, and childrearing; however I am reminded daily of just how privileged I am. Through my work at Global Partnerships (GP) I have seen first hand the way that poverty places exponential demands on women. I have listened to women in Latin America and sub-Saharan Africa share how lack of technology, transportation, or sanitary conditions extend tasks like gathering cooking fuel, accessing safe drinking water, preparing meals, or caring for children.
Despite these challenges, the women I have met are resilient, proud, and resourceful. They find innovative ways to access information, manage resources, generate income and build networks. To build a brighter future for themselves and their children. As impact-led investors we seek to understand why markets fail to efficiently serve those living in poverty – especially women.
Unfortunately, traditional economic models often fail to a) recognize the gender-differentiated nature of poverty and b) take into account how women make decisions and allocate resources. For over 23 years GP has been investing in womencentered finance, education, and health services delivered through the microfinance platform. During this time, we have invested roughly $144 million in 57 women-centered microfinance institutions (MFIs) across 15 countries, impacting over 3.7 million lives.
Beyond learning what it takes to achieve sustainability and scale access for women, we have learned that we must move beyond traditional economic models to create value for women living in poverty.
The organizations GP invests in understand market failures from the perspectives of the women they serve. For example, there are numerous barriers for women to access a loan or a savings account. Not only do many women not have the collateral needed to secure a loan, the loan process itself poses challenges. Whether it be lack of information about her options, transportation to get to the bank, the time it would take to get there, the treatment she receives when she arrives, or the complicated documentation process – there are a host of reasons why, even when there is “access”, women remain disproportionately excluded.
Microfinance’s success in reaching women came not only in the design of the product, but also in the delivery mechanism. The village bank innovation – lending to women in groups with a solidarity guarantee, came about through listening to, and watching, how women come together to mobilize resources. Early microfinance institutions leveraged the centuries old practices of savings and credit groups to deliver additional resources to women.
The key to their success? They started by going out to communities, rather than expecting women to come to them. They built trust-based relationships through loan officers who visited groups regularly. They relied on the social fabric of the group to underwrite and guarantee each other’s loans. Over time, client-centric MFIs started to identify additional needs and figured out ways to deliver more value through financial education, business training, and health services, all through the village bank model.
At GP, we have seen how our partners honor and value the voices of their clients. These MFIs continually solicit client feedback and adapt their service offering to better meet the needs of the women they serve. The best in class partners in our women-centered portfolio also know the important role of the loan officer. They recruit loan officers with not only financial knowledge, but also strong social and cultural skills - often hiring female officers from the communities they serve.
When it comes to serving women it is not just about what you deliver; it is about how you deliver it. It is about rooting your offering in the needs of women and designing solutions that address the unique nature of the challenges they face.
These learnings have been critical in identifying best in class partners in our Women-Centered Finance with Education and Health Initiatives. They also help inform our thinking as we expand into new product categories, like improved cookstoves, solar lights and home improvement finance – all of which have the potential to deliver benefits for women living in poverty.
Creating a New GP Investment Initiative: Home Improvement Finance
By Kusi Hornberger, VP of Investment Research, Global Partnerships
In February, Global Partnerships made a $500,000 impact investment in Procaja, a microfinance organization working in rural Panama, to support Procaja’s home improvement loan portfolio. This was not only GP’s first investment in a partner in Panama, but also our first loan in a new investment initiative: Home Improvement Finance (HIF). This was all the result of a year’s worth of research coming to fruition.
I had the opportunity to participate in the development of this initiative and meet Procaja and their clients. During our visit, we met people like Jocelyna Rodriguez Villar, her husband Demetrio, and their two children, Krystal and Deusalino (pictured above). Jocelyna and her husband have used three incremental home improvement loans from Procaja. The first loan was $500 to replace their dirt floor with a cement floor. The second was $500 to add a tin roof replacing one made from palm leaves. The third was $500 to add security grills to their front door and windows, as they had recently been robbed while Demetrio was working.
The combination of all these loans allowed the Rodriguez Villar family to begin to replace a traditional hut home with a new, more secure home. For them, household health, security and sense of dignity have increased due to: (i) lower exposure to bad weather (roofs, walls and floors) and sources of disease (sanitation and water), (ii) physical protection from robbers or unwanted intruders, and (iii) improved confidence and sense of self-worth in the community.
In addition to insights from client visits like the one with the Rodriguez Villar family, there were three key factors that tipped our thinking in favor of launching HIF as a GP investment initiative:
A large and growing problem: According to UN-Habitat, about one in four people live in conditions that harm their health, safety and prosperity. A McKinsey Global Institute report suggests that the global population who live in substandard housing units will expand to 1.6 billion people by 2025. This is an ongoing challenge facing poor households, particularly in the regions where we work.
Focused on poor households: Unlike affordable housing, home improvements provided via microfinance organizations can be financed incrementally with loans, and thus reach a wider and lower income demographic.
High-impact support services: In addition to tailored financing, we found that many microfinance organizations are also providing project budgeting and work planning, best practice construction education, as well as, on some occasions, assistance negotiating discounts on construction materials. This is consistent with our practice of investing in organizations that offer value-added services alongside access to credit that empower people to make the most of those loans.
A year ago, we set out to explore HIF as a potential initiative. Today, our investment in Procaja marks the first HIF partnership, as we now build an investment portfolio in this important and high-impact area of need. We are excited to share with you our expanding portfolio of initiatives as we continue to find more impactful and sustainable ways to address poverty.
Today, Jocelyna and her family feel safer, and they were full of pride as they showed me their home and the specific improvements they have added over the last two years.
As a parent, I know how important it is to provide a safe and secure home for the ones we love. I am proud GP is able to play a role in improving the health, security and dignity of households like the Rodriguez Villar’s.
Your support allows us to create initiatives like this, ensuring that we make impact-led investments in the most meaningful solutions for households living in poverty.
Between now and May 10th, all donations to Global Partnerships will be matched 100% (up to $16,000). Your gift will help us develop new initiatives and discover new partners that reach more families in poverty. Donate during GiveBIG to double your impact:
What it Takes to be Impact-Led
By Peter Bladin, Chief Impact & Research Officer
Long before we invest in a partner delivering life-changing products or services to households living in poverty, we begin by identifying what impact our investment will have on those households. We call this being impact-led. It is a defining characteristic of what makes Global Partnerships who we are.
To ensure that we invest in a partner that is dedicated to reaching underserved populations, and that the product or service they provide results in a positive impact, we research and develop investment initiatives designed to target a specific aspect of poverty. These initiatives clearly identify who is served, what product or service is delivered, why it is impactful, how it is sustained, and what is the expected impact.
A new initiative must address five key areas of analysis that are rooted in our mission: to expand opportunity for people living in poverty.
Our work starts with an assessment of how many people are affected by a specific problem, such as lack of access to financial services or living beyond the electrical grid. We work on problems affecting as many people as possible; large-scale problems are likely to attract more entrepreneurs trying to solve them, allowing GP to apply resources more efficiently and impact more people.
Using a combination of primary and academic research, we determine which services and products are making a positive and measurable impact on impoverished households. It is important to note that impact comes in many forms. It can be an economic opportunity, such as when a smallholder farmer increases her yield or has better market access leading to higher prices and more income. Or it can be an innovation like a solar light that provides a clean, reliable and cost-saving energy solution, replacing toxic kerosene lamps that are expensive, unsafe, and contribute to upper respiratory disease.
Next, we analyze whether the market can deliver these solutions in a sustainable way. We identify social enterprises that strive to reach marginalized populations with a focus on women and rural communities. These include non-governmental organizations (NGOs), for-profit social businesses, and cooperatives. We primarily invest debt capital into these social enterprises – our partners – who provide their clients with access to credit and affordable, high-impact products and services. This enables people in poverty to save time and money, access quality healthcare and earn a stable income. Our market-driven analysis is essential to ensure that each solution is affordable, easily accessible, and provides enough value for clients to choose it over existing options.
Fourth, we look at the potential for scale. Systematically addressing poverty is a massive undertaking, so we target solutions that can ultimately reach millions of people in the markets we serve — Latin America, the Caribbean and sub-Saharan Africa. We continually research market trends to see what could drive supply and demand for a product or service long-term, and whether the solution fits the market.
Once an initiative gets to this stage, we then build a pipeline of potential partners in which to invest. To be investment ready, a social enterprise must have finance needs that match the investment instruments we offer and qualify for our impact-led capital.
Developing these high-impact initiatives is made possible by you, our donors. Your gifts help fund the work of GP’s dedicated impact and research team. We work with leading industry experts as well as entrepreneurs who are pioneering innovative solutions. We meet with partners and their clients in person to learn about their preferences, challenges, goals and progress. We seek to understand the best outcomes through our research, helping us deploy capital to the best partners.
Your support allows us to remain impact-led, ensuring we invest in the most meaningful solutions for households living in poverty. It also enables us to monitor our results so we can continue to improve for even greater impact.
Between now and May 10th, all donations to Global Partnerships will be matched 100% (up to $16,000). Your gift will help us develop new initiatives and discover new partners that reach more families in poverty. Donate during GiveBIG to double your impact:
Expanding OPIC is Good for America and the World
By Rick Beckett | President & CEO, Global Partnerships
For more than 20 years, Global Partnerships has been committed to its mission of expanding opportunity for people living in poverty. We work as an impact-led investor in some of the most challenging developing countries in the world to support sustainable solutions to poverty.
In coming weeks, Congress will begin debate on the recently released Trump Administration “budget blueprint.” This blueprint includes a dizzying array of choices that lay waste to efforts aimed at fighting poverty, improving education and health for vulnerable populations, and engaging in smart global development.
One of the most inexplicable proposals included in the “budget blueprint” is to eliminate OPIC, the Overseas Private Investment Corporation. OPIC is the United States’ Development Financial Institution. OPIC makes investments through US companies that create jobs, increase exports, deliver positive economic and environmental impact in the developing world, and advance global peace and security.
A remarkable fact is that OPIC has operated for the last 39 consecutive years at a profit to the US Treasury. For every dollar it spends, OPIC returns about $8. In the last decade alone, OPIC has reduced the US budget deficit by almost $4 billion.
We at Global Partnerships know OPIC well. Since 2006, OPIC has invested more than $50 million in five of GP’s impact-led investment funds. OPIC’s participation has been instrumental in catalyzing more than $80 million in capital from other Fund investors. These GP funds have successfully expanded opportunity for more than 5 million people living in poverty in countries throughout Latin America and sub-Saharan Africa. That means impoverished women gain access to credit and business education that empower them to build small businesses, earn a living, and provide for their families. It means subsistence farmers gain access to the farm inputs and technical assistance that they need to grow more food and increase their income. It means poor families living without electricity are able to stop burning dirty kerosene and gain access to clean, solar light. It’s smart, sustainable global development. And the world needs more of it.
What sense does it make to eliminate, rather than expand, OPIC’s successful efforts to expand market based solutions to poverty in many of the worlds’ poorest countries?
What sense does it make to eliminate an agency that makes money for US taxpayers, reduces the US deficit, creates US jobs, and effectively promotes economic development on a global scale?
What sense does it make to shut down one of the US government’s most effective agencies and cede leadership in the developing world to other countries?
It makes no sense.
If you would like to take action, share this article on social media and please contact your representatives in Congress and ask them to support OPIC.
To learn more about OPIC:
Celebrating International Women’s Day
By Tara Murphy Forde, GP’s Vice President of Impact and Strategic Initiatives. Tara recently returned from Kenya, visiting GP's partner, Kenya Women’s Finance Bank (KWFT). Founded in 1981, KWFT has grown to serve over 800,000 clients and is the only Women’s Bank in Africa.
Teresia Wacuka’s family farm sits on the plains, before the ascent into the central highlands of Kenya. Modest in size but well managed, her farm supports eight cows, a chicken coop, and a field of subsistence crops. While Teresia speaks proudly of her contributions to the increased productivity on the farm, her focus is on what that productivity has meant for her family.
Teresia’s story begins much like other women born into rural poverty. She attended school until her parents could no longer afford the fees. With a primary education and a strong work ethic, she married, started a family and worked the farm with her husband. Despite all of her efforts, providing for her family was difficult and the prospect for a brighter future felt dim. That is until 2007 when Teresia and a group of women came together to form a village bank they called “Tia Wira,” meaning “respect for our work”.
They spent eight weeks in training with a loan officer from Kenya Women Microfinance Bank (KWFT). This group of women began to save money while developing basic financial literacy and credit management skills. At the culmination of the eight weeks, each woman took out a $100 loan.
Backed with a solidarity guarantee from the other women in the group, Teresia invested her first loan in the farm. After successfully paying back that loan, she took out a second loan to build a pit latrine, then a third to finance a water tank. Over the years Teresia has financed the family poultry business and their eight cows.
While Teresia refers to her husband as a partner in these endeavors, she is at the center of the decision making. This is especially evident when she speaks about the school fee loans she has borrowed to send her children to school. Teresia has opened a savings account in her daughter’s name and tells her to study hard so that she can one day become a loan officer at KWFT.
Teresia’s story, and so many others like hers, remind us of the power of investing in women. Not only are women disproportionately affected by poverty, they carry the multifaceted burdens associated with poverty in ways that are distinct from men. Across the globe women are more likely to be uneducated and operating in the informal economy; without access to a bank account or basic ownership rights. Amidst this adversity, they carry the burdens of tending to disease and time poverty – often spending hours a day collecting water or fuel for cooking, both of which are harmful to their health and that of their children.
But the evidence is clear: investing in women is an opportunity, not a constraint. Like Teresia, when given access to resources and information, women across the globe:
Transform educational opportunities into impact;
Use resources and assets to increase productivity; and
Invest more in the health and well-being of their families.
At Global Partnerships we believe that investing in women and the organizations that support them has the capacity to solve some of the world’s biggest problems. We believe that empowering women can improve their lives as well as those around them. In turn we proudly partner with organizations like KWFT and their clients, who like Teresia are boldly and decisively breaking the cycle of poverty.
By Rick Beckett, President & CEO, Global Partnerships
As the year draws to a close, I reflect, as many do, on the state of our world, and especially on the reality experienced by the poorest and most vulnerable among us.
I’m encouraged by progress that’s been made. Extreme poverty rates are on the decline. People are living longer, healthier lives. More developing countries are growing in ways that share some of the fruit of economic progress with those living “at the base of the pyramid.” Markets are increasingly engaged, alongside the public and philanthropic sectors, in addressing global poverty.
At the same time, literally billions of people who have been born into poverty are suffering. Too many struggle to meet even their most basic needs, and they do not have access to pathways out of poverty. If you’re one of those people, global statistics are of little consolation. We still have a lot of work to do.
When the sheer magnitude of the challenge feels overwhelming, I try to remember a simple truth – these women and men want nothing more than the opportunity to earn a living, to provide their families with a safe home, nutritious food, good education and healthcare. They want to create a better life.
What I’ve learned over the last decade at Global Partnerships is that it’s possible to create that kind of shared opportunity. When we keep our eyes and hearts open – when we focus on what actually serves people, when we work to ensure that the power of markets is used for good, when we thoughtfully and relentlessly invest our effort and resources in expanding opportunity, when we take risk for the right reasons – progress is possible. Our efforts create the very hope that we seek.
Rosa. Josefina and her son Juan. Lucila. Gloria. Theresa and Peter. These are but a few of the people who are now living better lives, because of their hard work and your commitment to expanding opportunity. In the last year alone, Global Partnerships, through its impact investing in social enterprises, positively impacted the lives of more than 1 million people in 14 countries on three continents. Together, we are making a difference.
In the latest edition of our IMPACT newsletter, you’ll read about Rosa Cruz Payehuanca. Hers is a remarkable story of resilience and courage. It is also a story about the power of opportunity. It’s the kind of story that reminds me of what’s possible. It is one of more than a million stories. Each one matters.
So as this year comes to a close, let us celebrate all that has been done. And let us recommit ourselves to the work ahead – to creating a world where everyone has the opportunity to create a brighter future for themselves and their families.
This letter is featured in GP's final newsletter of the year. Click here to view the full newsletter.
To support GP's work to expand opportunity for people living in poverty, please donate today:
Why GP Expanded to East Africa
By Aaron Nasurutia: Vice President, Lending & Portfolio Management – Africa, Global Partnerships
According to the GIIN 2015 report, The Landscape for Impact Investing in East Africa, East Africa is one of the centers of global impact investing. Activity has grown strongly throughout the region over the past five years during which $9.3 billion was disbursed by more than one thousand direct investments by development finance institutions (DFIs) and other impact investors active in the region. The report also stated that within East Africa, Kenya and its capital city Nairobi are the regional hub of impact investing in East Africa where at least 48 impact fund managers have staff placed.
Just over one year ago, Global Partnerships expanded into Africa with the opening of our office in Nairobi to initially invest in four East African countries: Kenya, Uganda, Tanzania and Rwanda. GP’s entry into Africa is at an opportune time with a rise of innovative solutions in the region – especially in clean energy, agriculture, and financial inclusion – which are aligned with GP’s mission.
GP expanded to Africa not only because investment and innovation in the region are growing, but most importantly because poverty has persisted for generations here, and markets must be pushed to empower people in a sustainable way. GP chose to focus its entry in sub-Saharan Africa for a variety of reasons.
For example, according to the Africa Energy Outlook Report published by the International Energy Agency (IEA) in 2014, sub-Saharan Africa had more people living without access to electricity than any other region in the world – more than 620 million people – which is more than the global total. In East Africa alone, more than 200 million people live without electricity – around 80% of its population.
Also, financial exclusion for the poor continues to be a major hindrance to poverty alleviation, as well as limited access to healthcare, clean water, proper sanitation, education and decent housing among others. Agriculture continues to be the main source of livelihood for the majority of rural communities in sub-Saharan Africa where smallholder farmers depend on crop farming and animal husbandry. GP’s mission to improve the lives of people living in poverty through our Investment Initiatives is well placed to impact millions of people in sub-Saharan Africa, beginning with the four East African countries.
In the past year GP has made solid progress both in making our first investments as well as research aimed at expanding GP’s Investment Initiatives. We have made three investments, one to a women-centered MFI, the second to a distributor of solar lights and the third to a rural-centered MFI that focuses on financing smallholder farmers. Our primary research done during this first year also yielded three investment initiatives: Smallholder Finance Services (SHFS), Rural-Centered Finance with Education (RCFE), and Women-Centered Finance with Education (WCFE).
As the person leading GP’s social investment lending in Africa, I am greatly inspired by the opportunity we have to impact millions of people living in poverty. In my former career as a commercial banker, the objective was maximization of shareholder value. Now, as an impact-led investor, GP is 100% focused on the household impact and on empowering people in a sustainable way. For me, the satisfaction of participating in such transformation is incredibly rewarding.
On a personal note, as someone who grew up in a family of farmers in rural Kitale in the North Rift region of Kenya, I am proud to be a part of a team enabling innovative change by providing much needed capital to social entrepreneurs in my home country and neighboring regions. This kind of impact changes lives and future generations. As an example, parents living in poverty can increase their income, giving them the opportunity to pay for their children’s education.
We look forward to sharing with you the impact our partners are having in Africa in the years to come.