At the end of last year, we committed to investing $100 million over three years to help build financial inclusion for the world’s poor. In 2012 alone, we invested no less than $67 million in pursuit of our strategic goals: to build the next generation of top-tier microfinance institutions (MFIs), to push the frontiers of financial inclusion beyond MFIs, and to help build a stronger industry. With your support, we have made significant progress in all three areas.
Among our most notable milestones in 2012 was the successful closing of Accion Investments in Microfinance, a for-profit equity fund launched in 2003 to provide commercial capital to MFIs working in markets where such funding was typically unavailable. The fund proved that a double bottom-line approach – delivering both financial and social returns – really is possible. Over its life, it generated more than 15 percent returns to shareholders. More importantly, it helped fund access to financial services for more than a million clients in Latin America and Africa.
We also committed our capital and professional expertise to strengthen MFIs in Bolivia, China, Colombia, Mexico and the Philippines – countries where financial inclusion remains elusive for millions of people living in poverty.
The second pillar of our strategy is to invest in innovative new companies with compelling new products and services created specifically for those living in poverty. We are doing that through two vehicles: Accion’s Frontier Investments Group and our $10-million Venture Lab. The following pages detail the exciting work these two groups are doing, including support for affordable housing and private-school financing for the poor in India, ‘nano-loans’ delivered by cell phone in Chile, and mining ‘big data’ to assess character for unsecured lending.
Third, we continue to invest in building a strong industry with high standards. Leading this charge is the Center for Financial Inclusion at Accion, whose Smart Campaign for consumer protection already boasts more than 3,600 endorsers in 135 countries, representing more than 1,200 MFIs that collectively serve no fewer than 60 million clients.
The Center is also leading the campaign for Financial Inclusion 2020. With sponsors and partners such as Citi, Visa, MasterCard, Western Union, Moody’s, Deutsche Bank, CGAP, IFC and the Bill & Melinda Gates Foundation, the audacious FI2020 project dares to envision a financially inclusive world – and to chart the course for turning that vision into reality.
It was a very good year, and we have terrific momentum – and with your continued support, we will keep it going.