The Oikocredit dream: a reality

Forty years ago, we had a dream, a dream which many in today’s financing circles translate into two words: ‘financial inclusion’.

Financial inclusion has been a buzzword over the past 10 years, but 40 years ago, this was certainly not the case. Oikocredit was a pioneer, a risk taker and we cannot fault the doubting Thomases to whom the dream seemed to be nothing more but the product of unrealistic, overly enthusiastic idealism.

And yet in Berlin on 11 June 2015 we were celebrating this dream as a reality. We have grown: in capital, in the number of partners, in portfolio outstanding, in the number of investors, in staff worldwide and in the sectors we support.

But beyond the numbers, we have also grown in our understanding of what is called for if the words ‘financial inclusion’ are to have real meaning and impact and help to create the more just, global society that we hold as our vision.

Many years ago, as regional manager for Oikocredit in the Philippines, I would say during my presentations to potential partners: “Oikocredit is here to support your ambitions for growth. When you have started something and need to scale up, but you lack the resources to do so, we are here to support you.”

Humbled by our failures, we have come to realize that while access to financial resources is a barrier, it is not the only one and at times, it may not even be the most critical.

We have seen how partners’ growth ambitions have been hindered by lack of clarity and unity on future direction within the organization; by lack of knowledge or skills; by lack of appreciation of the market environment; by lack of technology; by lack of capacity to analyse and use information.

Time and again, we have been called upon to go to partners with more than just an open wallet. And so today we talk about Oikocredit’s ‘development finance plus’ approach. This ‘plus’ includes capacity building, the technical assistance based on the extra support that partners need to make the financing work so that the lives of individuals, families and communities are improved.

This ‘plus’ approach works for us too. We support small, young organizations to develop their capacities so that they eventually qualify and meet our standards for a loan or equity investment. We support existing partners to improve and strengthen their performance ensuring that they are able to meet their financial obligations, thereby strengthening our own financial performance.

Our ‘plus’ approach has differentiated us from many other financial institutions. In the words of a Ugandan cooperative manager that I visited recently: “Yes, there are others who come, but they never stay long enough to understand us. Oikocredit has worked with us for long enough to help us make our dream a reality.”

On the occasion of Oikocredit’s 40th anniversary, we have much to celebrate and be proud of and thankful for. In all humility, we also see that much more remains to be done. We are strengthened by the support of members like Church of Sweden and ICCO and kept on course by our stakeholders' vigilance and commitment to our mission. We are inspired by the change we see on the ground and I hope you are too. We count on your continuing support and collaboration in keeping the Oikocredit dream alive through our ‘plus’ approach to development financing. Working together, we can look forward to even greater celebrations when Oikocredit turns 50.

Ging Ledesma
Social performance and credit analysis director
Oikocredit International