Accion is a global nonprofit organization with the mission of giving people the financial tools they need to improve their lives.
Accion’s vision is to build a financially inclusive world with access to economic opportunity for all.
Excellence.
Respect.
Passion for social change.
Letter from the President & Board Chair
We believe in a financially inclusive world—one in which every individual has access to a full range of high-quality, affordable financial services. With access and the right financial tools, people have a greater opportunity to capitalize on their abilities and achieve real economic gains, building brighter futures for themselves and their families.
Our work is guided by the lessons of our 50-year history, and a strategy based on three pillars: building the next generation of top-tier microfinance institutions (MFIs), pushing the frontiers of financial inclusion beyond MFIs, and helping to build a strong industry with high standards. Over the last year, we have made significant progress in all three areas.
First, we are working to extend microfinance to more underserved countries and regions of the world, launching Accion Microfinanças in Manaus, Brazil; strengthening our Indian partners; and working to build new alliances in China, Kenya, Mexico, the Philippines and beyond. And we’re increasing opportunity in the United States through the Accion U.S. Network, the largest microlending network in the country. Since its inception in 1991, it has extended more than $320 million in working-capital loans.
Second, we have launched Venture Lab, a $10 million new impact-investment initiative that provides
seed-stage funding for small start-ups developing new products and business models that increase
access to services for those at the bottom of the economic pyramid. And through our Frontier Investments Group, we continue to invest in other groundbreaking financial services, such as mobile payments in
Zambia; a technology services company in India staffed by the disabled; and life insurance for the most
vulnerable, such as those living with HIV and AIDS.
Third, the Smart Campaign—the flagship consumer-protection initiative of Accion’s Center for Financial Inclusion—continues to gather momentum across the globe, boasting more than 2,900 endorsers, of which 900 are MFIs who serve 40 million clients in over 130 countries. And, we have deepened collaboration with other industry leaders, including the Microfinance CEO Working Group, on a common agenda to address key industry challenges, with the goal of redoubling the industry’s commitment to consumer protection, pricing transparency and meaningful measurement of social impact.
We are proud of the work and achievements made over the last year, and of the value that Accion brings
in its effort to provide opportunity to millions of hardworking people throughout the world.
We are no less proud of, and honored by, your continued support. Your generosity makes our work possible.
Sincerely,
Our Clients
We invite you to explore the stories of our clients and their families. They inspire us, and they serve as good examples of how millions of brave and industrious people are working their way up the economic ladder, with dignity and pride.
SANDRA NIETO
Designer and client of Accion East, a member of the Accion U.S. Network, New York City.
When Sandra Nieto first moved to the United States from her native Colombia, she took on whatever jobs she could get: babysitter, maid and beauty salon assistant. But in the back of her mind she knew she really wanted to design clothing. “People would encourage me to start my own line,” says Sandra. “I was hesitant, because it’s the type of industry that you have to fight hard in.”
And fight she did. Sandra began devoting seven days a week and many late nights to cutting, sewing, and creating her clothes. The problem was having enough money to continue to design. “Everything I earned, I needed for food.” She looked into getting a bank loan, but no one would lend money to someone with no credit history.
When Sandra applied for a loan with Accion East, she found that Accion valued what other banks did not. “I applied and got approved, surely because of my years of experience and the momentum I already had going.” Sandra put the $6,000 loan toward renting space and hosting two fashion shows, and she started using what she earned to continue to build her business. The profits also came in handy when an unexpected emergency occurred; Sandra’s husband lost his job in 2010, the family was devastated. But all was not lost: Sandra had grown her business to the point where she could support her entire family herself, getting them through tough times.
YAN RONG MA
Buddha shop owner and client of Accion partner Accion Microfinance China in Yuanbaoshan, China.
Walking into Yan Rong Ma’s shop in Yuanbaoshan, Chifeng Prefecture, Inner Mongolia, is like stumbling on a hidden treasure shop. The walls are lined with what look like gold bars and sheets of paper money, traditional symbols used in Buddhist ceremonies. However, while her family's shop now prospers, this wasn't always the case.
When her husband first left his sales position a few years ago to open the shop, inventory was slim and profits were inconsistent. Needing more capital, Yan Rong and her husband decided against borrowing from friends, and, instead, they secured a 12-month loan for US$6,200 from Accion Microfinance China. Today, helping to preserve not only their business but important local customs, the couple supplies an even wider variety of religious tokens such as incense, Buddha statues and educational books. So whether you believe in the good luck of symbolic money or not, it is no question that access to real capital has brought good fortune upon the Ma family.
ERIVAN DOS SANTOS
Bicycle shop owner and client of Accion partner Microfinançasin Manaus, Brazil.
After a troubled youth, Erivan dos Santos realized one day that he needed to change his life. He took a low-paying job in construction and met a woman who would become his wife. A year later they had a baby boy, but as luck would have it, he was born with serious health issues. It was then that Erivan decided he would turn to self employment to stay afloat, and so his brother taught him how to repair bicycles and gave him a few tools and equipment to help him start a bicycle shop.
“My life changed since we opened this store, ” he says, looking around his small shop situated just outside of his father’s house, where he and his family also live.
“The beginning was difficult,” he says. “Sometimes we did not have enough money to buy food, and I struggled to get much needed capital. Since I couldn’t ask my father for more, I was glad to hear that Accion Microfinanças helped entrepreneurs like me. ”
Since receiving an initial loan of US$800 from Accion’s partner in Brazil, Erivan has been able to buy supplies and merchandise in bulk, helping him to service clients faster and make larger profits. Today, he is proud and thankful that both his business and family are thriving.
If you look closely at the front of his store, you’ll see the phrase, “Os que com lágrimas semeiam com jú bilo ceifarão.—SL: 126.5.” (Those who sow in tears shall harvest joy.) And while most of his tears are hopefully in the past, with the help of Accion, Erivan has most definitely been able to harvest joy and sow a successful future for his family.
ARGA BOURGEOIS
Raw food chef and client of Accion Texas, a member of the Accion U.S. Network, in Houston, Texas.
Arga Bourgeois is an experienced entrepreneur who has thrived in tough economic times. After many years in corporate America—first working in human resources and then in the food services department of the Houston school system—Arga left her job to join her father at his health supplements store. “I didn’t agree with what we were feeding these kids,” she explains. “So I quit because I wanted to live by my beliefs.”
For almost one full year, Arga worked from 6 a.m. to 7 p.m. while raising three children. She had no capital to afford an employee. “It was a roller coaster. As money came in, it went right out again.”
Arga hoped to grow her business by offering smoothies and raw foods that were growing in popularity. After being denied a $10,000 bank loan, in 2005, Arga met with an Accion loan officer, and she was approved for $12,500 to grow her business.
With new capital in hand, she invested in a part-time employee. Then, she started advertising and business grew rapidly. Despite unforeseeable challenges, such as Hurricane Ike—which shut down her business for eight months—Arga now has three employees and plans to open a second location.
Arga is an example of the determination often found in the microentrepreneurs Accion serves. “Nobody believes in relationships anymore. When the hurricane happened, other lenders just wrote letters to say I was late on payments. Accion came to visit me the next day. Because of our relationship, when I have two quarters, I pay Accion first. I love them.”
ANIDEBE JOHNSON
Electronics salesman and client of Accion partner Accion Microfinance Bank in Lagos, Nigeria.
A craft often passed down through lengthy apprenticeship, electronic repair and resell can be a difficult business to learn. However, Anidebe Johnson was lucky enough to have had a talented mentor who taught him well, and for the last 33 years Anidebe has continued to perfect his skill and grow his own business in the heart of Lagos, Nigeria.
In 2007, with the help of a small loan of 100,000 Naira (approximately US$600) from Accion partner Accion Microfinance Bank, Anidebe was able to increase his profits by purchasing parts in bulk and diversifying his inventory—he now sells everything from second-hand office chairs to automatic chocolate fountains to TV stands, which are consistent best sellers.
Over the years, increased profits have allowed him to expand and open three warehouses and hire three employees. But, to the well-respected community man affectionately known as “Papa,” it’s no surprise that he is most proud of his ability to send all six of his children to school, an opportunity that he did not have growing up. It is that pride of a father providing for his children that shines through in Anidebe’s charming smile, a smile made brighter with one small loan.
BAINABAI SAGAR
Tea stand owner and client of Accion partner Mann Deshi Bank, with whom Accion is piloting its financial literacy and “Dialogue on Business” programs in Mhaswad, India.
The first time a customer ordered tea from Bainabai Sagar’s roadside shop, she was paralyzed by fear. “I was so nervous I forgot to put in the sugar,” she explains. “Everyone was watching me. I had to throw out the chai and make it again.” Since that first day, Bainabai has built a steady customer base and a network of local supporters for her chai business, from which she earns 100 Rupees (US$2.22) daily. She sells the thick sweet brew from a beat-up steel table, upon which rests a giant steel teapot, a kerosene stovetop, six small glasses and a small metal box for her earnings.
Forced to leave school and marry at eight years old, Bainabai has overcome many challenges throughout her life, including the daily struggle to support three children on her own. She took whatever work she could find, decorating sandals and purses and earning 5 Rupees (US$.11) a day and working as a wage laborer earning little more for performing backbreaking labor.
When a family illness in 2005 forced her to seek out her first loan of 10,000 Rupees (US$222), she seized the opportunity to finally establish her own stand selling chai. Her business has flourished, helped in part by the financial literacy training she received through Accion’s Financial Literacy Toolkit and Accion’s ‘Dialogue on Business’ program, which helped her to develop her communication and leadership skills. “Now women come to me for advice about interest and installments.”
In addition to being able to provide for her children, the ability to interact with mainstream society and be treated with respect is one of the best things to have come of her involvement with microfinance.
REINALDO NIÑO
Weaver and client of Accion partner Finamérica in Bogota, Colombia.
Ciudad Bolivar is a sprawling urban area in the southwestern part of Bogota. With an estimated population density of 45,000 inhabitants per square kilometer—New York City has less than 10,000 by comparison—the area has, by most indicators, the worst social conditions in Bogota. Reinaldo Niño, 57, lived in the streets of Ciudad Bolivar for 38 years that he calls long and difficult. Today, he owns a business, has three full-time employees and his four children are through college.
Reinaldo’s path to becoming the business man he is today began days after a police raid that cost him his right eye. He happened upon the remnants of a wool sweater in the middle of one of Bogota’s busiest intersections. From it, he knit two scarves. He sold them downtown and reinvested the proceeds in materials to make four scarves, then six and so on. That is how he started experimenting with the idea of running a business.
Fast forward to 2007 when Reinaldo participated in Accion’s business training program—‘Dialogue on Business’—and learned about cash management, bookkeeping, savings and investment. A few months later, Reinaldo received a US$1,000 loan. He was able to purchase materials to build a loom and bought yarn and other supplies in bulk to improve his margins. Currently, Reinaldo sells about five to seven million pesos a month (US$2,700 — $3,800) worth of wool scarves. He pays his rent, contributes to a retirement plan and together with his wife can afford his children’s education.
Since Reinaldo’s first loan, he has built not only a business that sustains his family, but also a loyal following of community members whom he has employed, trained and taught valuable life skills.
PURA PARADA HURTADO
Dairy farmer and client of Accion partner BancoSol in La Reforma, Bolivia.
When Pura Parada Hurtado bought land for a dairy farm 20 years ago, she and her husband relied on a loan to make the purchase. Confronted with the fierce competition that has pervaded Bolivia’s agricultural market, Pura’s family sought a loan from Accion partner BancoSol to buy more cattle and machinery. In a short while, she found herself managing six employees who live on her farm. Patting her favorite cow named Isa, Pura says, “We”ve always been clients of the bank. Everything we’ve done has been with loans.”
Reaching out to people who live in remote areas, such as Pura, is not easy. Long distances, deeply rutted dirt roads and washed out bridges separate the rural poor from programs that can help them improve their standard of living. Yet the need is great: Families in rural Latin America not only have larger households, fewer assets and less education than their urban counterparts, but 90 percent of them also lack access to financial services.
This is why Accion is creating a replicable model for rural microfinance in Latin America. Supported in part by a grant from the Inter-American Development Bank, Accion and five of its long-term partners have set out to demonstrate that serving the rural poor with microfinance is sustainable. The project was launched in 2009 and seeks to serve 200,000 people by 2013.
As for Pura, she knows firsthand how financial tools can help create opportunity. “It would be difficult to build this business without the bank—we wouldn’t have the capital to do it.”
BETTY AND LUIS SUXO SIRPA
Furniture makers and clients of Accion partner BancoSol in El Alto, Bolivia.
Betty and her husband Luis have been in their furniture-making business together since they married in 2004. Each day, they sell their goods at the market between 6:00 and 11:00 a.m., then return to their workshop to build more. Combining hard work with a few small loans from longtime Accion partner BancoSol, they have expanded the business and bought a home and workshop of their own.
Betty runs the furniture making from soup to nuts, including finances, operations, sales and product development. “It’s a bit of responsibility,” she says, “but it’s fun and every day is different.” Her husband and their four employees complete between 15 and 20 mid-sized sofas each week, and they have set their sights on doubling output.
Like so many microentrepreneurs, Betty and Luis share the joys and anxieties of business ownership with their closest of kin. Luis’s parents regularly make the multi-day trip from the northern town of Ixiamas to deliver freshly cut cedar, oak and mahogany, while his brother preps the wood at his lumber mill around the corner. Besides lumber and furniture, the entire family also shares Accion partner BancoSol: They all have loans with the seasoned microlender and rely on its services to help them expand their businesses.
If the methods of Betty and Luis’s success are multifaceted, their primary motivation couldn’t be simpler. When a compact, rose-cheeked toddler comes scooting into the workshop pushing a toy truck, Betty scoops him into her arms. Her face softens as she says simply, “We are working for our son.”
JHANG YANAN
Barbecue shop owner and client of Accion partner Accion Microfinance China in Chifeng, China.
When Jhang Yanan heard about Accion from a friend in a nearby shopping center, steps from Accion Microfinance China’s (AMC) first branch office, she told her husband Yue Hongwei, and together they joined a modest, but growing, group of clients. They borrowed 20,000 Yuan—US$3,000—to support not one, but two new ventures: Jhang Yanan’s Wujia Barbecue Shop and her husband’s modest taxi business.
Wujia Barbecue Shop sits on Tianshan Road. Its kitchen, a narrow, high-ceilinged room at the back of the building, looks modest and is filled with smoke. They serve all types of skewered meats, seven days a week, until 2 a.m., and Jhang Yanan tends to it by herself.
The couple bought Wujia in 2009, and though their experience as restaurateurs has been limited, they are determined to make it work. They have a 15-year-old daughter they are now confident they’ll be able to send to college.
Today, AMC clients like Jhang Yanan and her husband number nearly 1,000, divided between branches in PingZhuang and Hongshan County—a small example of capitalism on the northern edge of China, in a place that reminds us a little of an American industrial city, and a lot about the common desire for a better life.
OKATOR NMAJU TASIE JOHNSON
Tailor and client of Accion partner EB-ACCION Microfinance in Douala, Cameroon.
At the age of 25, Okator Nmaju Tasie Johnson left his native Nigeria to look for a better life in Douala, Cameroon. In Nigeria, Okator had made a living selling shirt material, but the tough economy and lack of access to financial services, over time, left him without a job.
After moving to Cameroon, he tried his luck in the same line of business. He believed he could be successful but knew he would also need some help to get started. Luckily, he learned about Accion partner EB-ACCION Microfinance and applied for a loan. Not only did EB-ACCION Microfinance lend him the funds, but as a standard procedure with all its clients, EB-ACCION Microfinance required Johnson to attend training sessions about credit management, bookkeeping and other key financial literacy tools.
Before the loan, Johnson’s family was still in Nigeria. Since taking the loan, he’s been able to have his family join him in Cameroon. His shirt business has flourished, as has his family: He is the proud father of twin boys. When we asked him about his dreams for the business, Okator says he wants to import material from China. Accion will help ensure that Okator’s dream becomes a reality.
FALODUN RISKAT
Poultry vendor and client of Accion partner Accion Microfinance Bank in Lagos, Nigeria.
Twice a week, Falodun Riskat made the seven-hour round trip journey to a farm in a neighboring state to buy live poultry. Then, at the crack of dawn each remaining day, she carried four cages full of chickens, cockrells and turkeys through the hot, crowded passages of the Awolono Market in Mushin—a sprawling open bazaar in the streets of Lagos, Nigeria. Repeat this times 20 years, and you’ll get a better sense of what Falodun’s life used to be like.
Then one day Falodun heard about Accion partner Accion Microfinance Bank through a market storm—a coordinated barrage of loan officers going stall to stall to hand out promotional leaflets about their institution’s services. In 2008, her days changed for the better when she received a US$840 loan to expand her business. Falodun was able to acquire more animals and supplies, thus minimizing her time on the road and the resulting losses she experienced from the extreme heat that sometimes killed her chickens in transit.
Today, Falodun is also able to breed a few birds herself. She has given her business the name “Ilunu Livestock Venture.”
With fewer trips to the neighboring state, Falodun has more time to care for her two children, and while she did not go to school herself, she is making sure her children do. Nestled between long rows of cages in the fowl market, Falodun tells us the biggest challenge her business has faced is not having enough capital. Today, that is no longer the case.
Strategies At Work
1. Building Top-Tier Microfinance Institutions.
Accion’s role in the industry is unique. We build sustainable, scalable MFIs that share our commitment to the double bottom line—maximizing both financial and social impact—by providing those MFIs with management services, investment and governance. Like a venture capital firm, we combine investment of capital with managerial expertise. Our managers are typically seconded to partner MFIs and use their experience to help build sound, commercial models of microfinance that are scalable, profitable and carefully attuned to protecting client’s rights. Together, these services help catapult smaller, younger MFIs to the highest level of performance.
We have focused our attention on some of the poorest populations in some of the most challenging environments in the world. For example, in 2011 we inaugurated Accion Microfinanças in Manaus, Brazil—the heart of the Amazon, where half of the region’s 14 million inhabitants live in poverty. We are proud to say that the institution closed the year meeting operational goals and a client portfolio well above initial projections.
In China, we are helping to build a new microfinance industry. We have partnered with Sagamore Investments, which is making a RMB 140 million (US$21.9 million) investment in Accion Microfinance China. The funds will significantly strengthen our microlending operations in Inner Mongolia, where 40 percent of the population remains below the poverty line.
In India, Accion has recently made equity investments and extended guarantees for our Bihar- and Mumbai-based partners, Saija and Swadhaar, redoubling our commitment to financial access in a nation where the growth of microfinance remains beset by great challenges.
In Africa, we are strengthening EB-ACCION Microfinance in Cameroon, a country in which more than 65 percent of the actively employed population lacks access to any form of secure, financial services. Our partners in Tanzania, Nigeria and Cameroon today provide secure savings accounts to more than 250,000 low-income people. We also proudly recognize the achievements of Accion Microfinance Bank in Nigeria, recently voted ‘Microfinance Bank of the Year,’ and Ghana’s EB-Accion Savings and Loans, named African Banker’s ‘Microfinance Institution/Project of the Year 2011.’
And we are exploring new opportunities in the Philippines, Kenya, Mexico and other countries.
In the United States, we continue to strengthen our 20 years of work in small-business lending and financial education. The Accion U.S. Network—the largest microlending network in the country—is already benefiting from the ‘Big StartUp,’ a nationwide jobs-creation initiative recently launched by the New York Stock Exchange, which has recognized Accion as a leader in the field.
We are proud of all these achievements, yet we still have much to do. Our research and development, supported by philanthropy, enables our work on client-appropriate products and services. Examples can be found in such countries as Colombia, Peru and Ecuador where, supported by the Inter-American Development Bank and the Bill & Melinda Gates Foundation, we are developing savings products and outreach methods to make microfinance easier, more efficient and more economical.
Capacity building remains a hallmark of our work, and it continues on multiple fronts. Through our Global Training Centers in China, India and Ghana, which are supported primarily by Credit Suisse, Accion trains and mentors microfinance managers and staff.
And we continue to enable microentrepreneurs through our ‘Dialogue on Business’ skills training and financial literacy programs. Over the last year, we have delivered new training modules in multiple languages across Latin America and India on subjects from cash and credit management to marketing and sales practices. For example, in partnership with the Muthoot Pappachan Group, Accion has recently trained more than 25,000 microentrepreneurs in India’s southern states, with plans to train a total of 100,000 by 2014.
Ultimately, top-tier MFIs will provide better access to more high-quality financial services and products for more people in more places. And that is taking us one step closer to our vision.
Many of the most compelling financial services and methods being created to serve the entrepreneurial poor are being developed outside of traditional brick-and-mortar MFIs. To help serve those companies, Accion launched the Frontier Investments Group—a hands-on equity partner that invests in early-stage, post-revenue companies that have moved beyond the seed stage. Frontier Investments focuses on three sectors that promise new solutions for underserved markets: technology, such as off-the-shelf core banking systems that improve the reliability and scalability of traditionally paper-and people-intensive microfinance models; distribution, such as branchless banking payment systems that lower costs and expand outreach of financial services; and new products, such as microinsurance and other services that address demands beyond microcredit.
In recent months, Frontier has invested in Mobile Transactions International, a mobile payments business with a vision of transforming the way people and organizations transact business by reducing reliance on cash. Mobile Transactions operates in Zambia,
Zimbabwe and Mozambique.
Frontier has also invested in Vindhya e-lnfomedia, a business process outsourcing company in India whose customer base primarily consists of info-tech and microfinance companies, and whose employee base is largely comprised of people with disabilities.
The organization has been recruiting, training and employing differently abled people since its launch in 2006. Currently, nearly 90 percent of its employees are physically disabled, and also lack access to economic and other opportunities.
Frontier was also the first institutional investor in Leapfrog Investments, one of whose portfolio companies, AllLife, provides life insurance to South Africans living with HIV and AIDS.
Our experience with Frontier has shown us that we can still do more to help build enterprises whose
goal is to broaden financial inclusion. To that end, Accion recently launched Venture Lab, a $10 million initiative that provides seed funding and technical assistance to promising start-ups often considered by others to be ‘pre-investable.’
In addition to capital, Venture Lab provides a dedicated team ready to assist with early-stage tasks such as analytics, financial modeling, business development and reaching scale. The Lab’s assistance leverages Accion’s technical capacity, its global network of MFIs and its relationships in the microfinance and mainstream financial industries to help build an entrepreneurial ecosystem in which these small, young portfolio companies can thrive.
We are building an industry with high standards through numerous collaborative projects and programs—none as unique and widespread as the Smart Campaign.
The flagship effort of Accion’s Center for Financial Inclusion, the Campaign’s goal is to protect microfinance clients through seven fundamental consumer-protection principles. The Campaign encourages microfinance institutions to commit to the principles, then trains and certifies the MFIs in the application of those principles.
Since its launch, the Smart Campaign has experienced remarkable uptake. Today, it boasts endorsements by more than 2,900 signatories, of which approximately 900 are institutions serving some 40 million clients in over 130 countries. The Campaign is helping to ensure quality delivery of services worldwide.
We are also working on many other opportunities that we believe can significantly help improve the industry.
In 2011, a group of CEOs from global microfinance organizations—FINCA, Freedom from Hunger, Grameen Foundation, Opportunity, Pro Mujer, VisionFund, Women’s World Banking and ourselves—formed the Microfinance CEO Working Group. The published result of our initial discussions—the “Road Map for the Microfinance Industry: Focusing on Responsible and Client-Centered Microfinance”—outlines our collective vision for ensuring the continued success of the microfinance industry for years to come.
Central to this vision is the Working Group’s support for three key initiatives: the Smart Campaign, Microfinance Transparency and the Social Performance Task Force’s universal standards for social performance management.
Microfinance Transparency promotes the importance of pricing transparency and provides a forum for MFIs to clearly transmit pricing information to all interested stakeholders. Over time, widespread transparency will
put pressure on all players to compete and reduce rates.
The Social Performance Task Force builds upon the foundation of client protection and transparency, and recently released its “Universal Standards for Social Performance Management.” These standards mark a noteworthy achievement in industry consensus on how we pursue our social missions and, ultimately, how we determine social impact.
If the microfinance industry can come together and, with one voice, support and advance these fundamental practices, it will have taken key steps to expanding essential financial services to the 2.5 billion people who remain without access to these services, and whose lives could be made so much better with that access.
