MexicoSOFIPA
With a first loan of EUR 300,000 to new local partner SOFIPA in Mexico, around 1,000 women will get access to finance so they can expand their companies by offering for example more products. The women ask for this credit via a group loan, so they are all responsible for the repayments. **please note: this project contains an exchange rate risk EUR/USD)**
€300,000
6.00%
18 months
6 months
USD
Currency| Amount | €300,000 |
| Interest | 6.00% |
| Maturity | 18 months |
| Repayments | 6 months |
| Currency | USD |
Summary
Summary
The southeast of Mexico has historically been the region with the greatest lag in the country. This region presents the highest rates of poverty, derived from a great lag in education, infrastructure, and basic services, which greatly limits its development.
Financial inclusion is another of the major problems that afflict this region of the country, derived from a scarce offer of "specialized financial services for low-income people." It is, thus, how, taking into account this context, SOFIPA emerged in February 2004, seeking to be part of the solution for the region’s development and to address the lag in financial inclusion of the unbanked sector.
SOFIPA started operations under the legal figure of the Cooperative Society. However, in search of being more competitive and innovative, in 2016, they decided to adopt the legal formation of an Investment Promotion Company, SOFOM, ENR.
Mission
Improve the quality of life of families through timely and innovative financial solutions.
Vision
To be a leading, popular, reliable, and profitable finance company, serving more than 150,000 families by 2025
Use of Proceeds / Loan purpose
With the loans, we will provide approximately 10,000 credits per year, to women at the base of the pyramid, who have decided to generate their own income and are able to start or expand their business; of which, due to service areas and customer profile, 80% will be in rural areas and 20% in urban areas, according to our target market niche.
These loans will empower women and improve the economic situation for them and their families, thus reducing poverty and providing food and education for their families, improving their opportunities, and changing their quality of life.
So far this year, at the end of October 2022, 100,544 loans have been financed, with a staff of 467 collaborators, 276 men, and 191 women.
| Company name | SOFIPA |
| CEO | Francisco Diaz |
| Founded | 2004-02-01 |
| Location | San Antonio de la Cal |
| Sector | Financial services |
| Turnover | $9,100,000 |
| Employees | 467 |
| Credit Score | 3.31 |
Impact
97% of Sofipa’s clients are female entrepreneurs. Mainly active in the informal sector, the most significant need of these women is access to the financial system.
The goal of the Mexican microfinance institution is to end poverty by giving people growth opportunities and fight for gender equality by helping women to improve their income. They have been able to support more than 14,500 women so far.
Sofipa offers female entrepreneurs credit through group loans. Read more about how group loans work in the introduction blog post of Sofipa here.
Sofipa has a presence in 7 of the 32 states and is particularly active in two states with the highest poverty rates in Mexico, Guerrero with 38.41%, and Oaxaca with 33.49% of the national level.
A study, conducted by 60 decibels, shows the following results of impact and customer satisfaction among Sofipa clients:
· 1.2 Inclusion Index (view here)
· 71% think that Sofipa is a good financing alternative
· 83% intend to use the loan to grow their existing businesses
Research shows that women in emerging markets invest 90 cents of each extra dollar they earn in their families and immediate environments. This translates into better schooling, healthcare, overall lifestyle, and eventually, economic growth.
Providing female entrepreneurs with suitable financing options helps them overcome those barriers that keep them from starting or growing their businesses. Specific loan features that appeal to the typical female SME owner are longer-term loans, lower interest rates, alternative collateral, and repayment grace periods.
SDGs impacted
With this project, you are contributing to the following Sustainable Development Goals:
SDG 1 - No poverty
SDG 5 - Gender equality
SDG 8 - Decent work and economic growth
SDG 10 - Reduced inequalities
Read more about the impact you can make through our platform and the SDGs on our impact page.
Related blog articles
- Get to know 3 female entrepreneurs who benefit from a loan through Sofipa.
- Female entrepreneurs are essential for a powerful economy. Read why here.
- Want to learn more about gender lens investing? Click here.
- Want to learn more about how financial inclusion can thrive entrepreneurship? Read here.
- With this investment 10 jobs are created
- With this investment 1000 lives are improved
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We have already contributed for SOFIPA
Danny MerckxFlorette KoningJan de WitPieter van der Plasmelle reiff