For many people, the start of the New Year marks a time to make improvements and changes to their lives through a New Year’s resolution. At FINCA International, we are no different. Though our 2020 resolution is a little different than most.
As a nonprofit organization working to alleviate poverty, our New Year’s resolution is to continue working toward this goal. However, with 2020 marking the start of a new decade, it also marks the beginning of the 10-year countdown to the end of the United Nations Sustainable Development Goals (SDGs). These 17 goals were developed to be an urgent call to action for countries around the world. Each goal addresses a general global issue, and the idea is that each goal will be met by the year 2030.
In light of this 10-year countdown, we at FINCA have made it part of our resolution moving forward this year to measure our progress by how our mission and programs are contributing to the achievement of the widely accepted SDGs.
This article is the first in a series of three, outlining how each of our programmatic offerings—microfinance and fintech solutions, impact investing, and our social enterprise—collectively support 15 of the 17 SDGs. This first article will focus on the programmatic area we began with in 1984: microfinance and fintech (financial technology) solutions.
As the founder and majority shareholder of FINCA Impact Finance (FIF), a global network of community-based microfinance institutions and banks in 20 different countries, FINCA International has been working in the microfinance sector for over 30 years.
As a prominent actor in the microfinance industry, we understand the importance of technology in finance. This led us to launch FINCA Forward, an initiative facilitating collaboration between early-stage fintech enterprises and microfinance institutions. The aim is to help fintech start-ups to better reach under-banked populations, especially women.
Together, FIF and FINCA Forward directly and indirectly contribute to 10 of 17 SDGs:
In line with our mission, this SDG is the underlying theme behind our microfinance work. FIF aims to provide low-income and underserved populations with access to financial services and technologies. Additionally, FINCA Forward facilitates partnership opportunities between banks and innovative fintech companies to make essential financial services more accessible and affordable.
Many FIF subsidiaries provide agricultural loans to farmers. They use these loans to help enhance their productivity and distribution methods, which increases the country’s food security.
In select subsidiaries, FIF offers medical insurance for the coverage of essential health and/or savings services. These services are designed to cover medical expenses or travel to medical facilities when needed.
Many FIF subsidiaries provide education loans and/or savings services. Customers can use these loans to pay for their or their children’s educations, buy school supplies, etc.
As one of FINCA’s core commitments, FIF works to empower women through access to finance. With nearly half of global borrowers being women, we are increasing gender equality. This creates opportunities and economic growth in society. Additionally, FIF takes extra measures to secure women’s participation in countries where their freedoms are more limited.
Getting a loan (in FINCA) is a quick process, efficient and the staff are very helpful, I recommend to all women who do not have financial support for their business, to take a loan from FINCA[…]
-Xheva Haziri, Kosovo
FINCA Forward also promotes gender equality through its focus on (1) products and channels designed specifically for female microfinance clients and (2) consideration of female-owned and female-led enterprises in selection of participating fintech companies.
Some FIF subsidiaries offer renewable energy loans to support the adoption of affordable, modern energy sources. These loans are exclusively for clean energy sources, such as solar or thermal.
FIF promotes expanding access to financial services—such as individual and small business loans—that give entrepreneurs the opportunity to start or grow their businesses and create jobs in their communities.
Thanks to my FINCA loans, I was able to hire twelve employees, sell my goods retail and wholesale, and even to distributors who export my products[…]
-Ana Maria Ticum Tiriquiz, Guatemala
To supplement this, FINCA Forward provides banks with a streamlined method for implementing new, more efficient technologies. This implementation supports early-stage fintech growth, fosters entrepreneurship, promotes job creation, increases access to financial services and creates more productive economies.
Similarly, the small business loan products many subsidiaries offer increase access to financial services across industries. FINCA Forward also directly provides financial and technical support to facilitate financial infrastructure development to increases access to financial services for small-scale industries.
By supporting access to financial services, FIF is directly supporting sustainable income growth for low-income populations and reducing development inequalities. FINCA Forward assists with this by promoting the development of technologies that reduce the barriers to lending to marginalized customers. This directly supports sustainable income growth for low income populations and reduces development inequalities.
Both FIF and FINCA Forward work in collaboration with a variety of actors—including a global network of banks, donor institutions, private investors, government agencies, technical assistance providers, researchers, and more—to promote sustainable financial inclusion worldwide.