Collaboration Opportunities for Foundations and Donors

MicroCredit Enterprises, a 501(c)(3) non-profit organization, welcomes collaboration opportunities with foundations and donors committed to addressing global poverty. For foundations, MicroCredit Enterprises offers both highly-leveraged grant opportunities and high-impact program-related investments (PRIs).

For a fuller explanation about PRI options with MicroCredit Enterprises or to discuss donor opportunities in more detail, contact Jonathan C. Lewis, Chief Executive Officer, MicroCredit Enterprises.

MicroCredit Enterprises is a non-profit public charity. Please review the Internal Revenue Service approval letter.

For the private foundation (inclusive of family or company-affiliated foundations) that supports poverty alleviation initiatives, MicroCredit Enterprises offers two program related investment (PRI) opportunities. Both options are straightforward, permitted under federal law, easy to implement and simple to administer.

PRI Option One – Interest-Bearing, Secured Loan: A foundation can provide an interest-bearing secured revolving line of credit. Each $1.2 million loan (the minimum required) supports up to 12,000 microcredit business loans which are, in turn, administered by established microfinance organizations in developing countries. MicroCredit Enterprises secures the line of credit with full recourse guarantees (10:6 collateral-to-loan coverage) provided by high net worth individuals and institutions (including other foundations). MicroCredit Enterprises seeks the most affordable loan terms commensurate with a foundation’s risk profile since ultimately MicroCredit Enterprises' cost of borrowing is borne by poor women entrepreneurs in the developing world. A loan PRI option contributes towards a foundation’s pay-out requirements at the time the loan is made.

PRI Option Two  Guarantor: A foundation can guarantee loans to MicroCredit Enterprises. Each $1 million guarantee (the minimum required) supports up to 5,000 microcredit business loans. The foundation maintains complete control of its assets, thus receiving all investment returns from its portfolio, but does not realize a return on the guarantee risk. In the event of an overseas financial loss, each Guarantor bears the loss on an equitable, pro rata basis with all other guarantors. A Guarantor PRI option contributes towards a foundation¡s pay-out requirements if the guarantee is called upon.

These two PRI options and a brief summary of the microfinance field are described in more detail in Mission Investing in Microfinance: A Program Related Investment Primer and Toolkit. In the spirit of partnership, MicroCredit Enterprises offers this Primer and Toolkit into the public domain for informational purposes.

The Permanent Fund to Alleviate Extreme Poverty gives individuals and foundations an opportunity to support MicroCredit Enterprises' microloan programs with direct grants or contributions. One hundred per cent (100%) of every gift directly funds microloans for deeply impoverished entrepreneurs, nearly all of them women with children. No overhead, no administrative fees, no fundraising costs are paid for with donated money or grants to the Fund.

Every gift to the Permanent Fund provides perpetual benefits. As loans are repaid, the money is loaned out again to other worthy borrowers. Since the typical loan term is four to six months, every donation or grant will be loaned out (on average) at least twice a year, every year, in perpetuity.

A $1,000 gift will help approximately 25 extremely poor women and children escape poverty and advance toward self-sufficiency in the first year. In every subsequent year, the same $1,000 will help another 25 of the world’s poorest people escape extreme poverty and hunger and become self-sustaining.

To learn more about the Permanent Fund for the Alleviation of Extreme Poverty, contact John Hershberger, Director of Stakeholder Engagement

The HunterDouglas Endowment for Microfinance Sustainability offers the opportunity on a tax-deductible, charitable and highly-leveraged basis to further strengthen the creditworthiness of microfinance by augmenting a permanent fund to respond to unexpected financial emergencies in overseas microfinance loan portfolios. The HunterDouglas Endowment is a permanent revolving account (a "fiscal safety net") to support loans to MFIs during weak financial times.

The HunterDouglas Endowment makes MicroCredit Enterprises a supportive banker for the poor without jeopardizing the basic fiscal integrity of the program. While ultimately Guarantors stand behind and financially cover overseas MFI defaults, the HunterDouglas Endowment provides Guarantors, MicroCredit Enterprises and its line of credit lenders with the assurance that obligations can be met in timely and orderly manner. Repayment of MFI loans depends on multiple factors, but often loan defaults, while serious, are transitory. In those instances, "foreclosing" on an otherwise excellent MFI beset with only temporary financial difficulties is a bad idea because a foreclosure ends any chance for MFI loan repayment and, not incidentally, financially punishes successful women entrepreneurs for events outside their control.

The HunterDouglas Endowment is currently funded at $1 million. Every penny directly benefits the program; no overhead costs are paid by the HunterDouglas Endowment.

On behalf of the destitute families we serve, MicroCredit Enterprises is grateful to the individuals, corporations and foundations who have provided charitable donations, grants and program-related investments (PRIs) in support of special projects and the HunterDouglas Endowment for Microfinance Sustainability, including but not limited to:

Annoymous
DBL Foundation
Calvert Social Investment Foundation
Peter C. Cornell Trust
Wallace Alexander Gerbode Foundation
Hunter Douglas
Michael and Susan Kahn
Maggie Kaplan
Michael H. Katcher
Eric McCallum & Robin Smith
MSST Foundation
Greg Nelson
Oswald Family Foundation
Swift Foundation
Three Guineas Fund
Tides Foundation