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FINCA International, Inc.

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Nonprofit Overview

Causes: Economic Development, International, International Economic Development, International Relief, Microfinance, Small Business Development

Mission: FINCA''s mission is to provide financial services to the world''s lowest-income entrepreneurs so they can create jobs, build assets and improve their standard of living.

Results: FINCA provides small loans and other financial services to over 1.7 million clients in 23 countries, with a global loan portfolio approaching $1 billion, to enable them to build small businesses and work their way out of poverty. The simple idea of helping people to help themselves remains at the heart of our approach to fighting poverty to this day. In 2013, FINCA Eurasia's borrower base grew by a healthy 8.9% to 438,900 people, and the gross loan portfolio surpassed $520 million. In Africa, the number of borrowers grew by 23.5% to 339,700 entrepreneurs across five countries, and a gross loan portfolio of more than $116 million. We saw a 101% increase in the number of savers in the region, thanks to Tanzania and Zambia joining DRC and Uganda to provide this service. In Latin America and the Caribbean, our subsidiaries faced strong headwinds due to a deteriorating economic and security environment, so our growth was up by only 1.6%. One bright spot was Haiti, where our program grew from 2,445 to 10,244 borrowers in just 12 months by end of year 2013. Overall in the region, we had 282,100 borrowers and more than $157 million in outstanding loans to clients by the end of 2013. The Middle East and South Asia includes our subsidiaries in Afghanistan, Jordan, and Pakistan, with a total of 85,300 borrowers at end-2013, and a gross loan portfolio of over $46 million. Outreach in Jordan increased by 23%, while in Afghanistan it increased by an incredible 41%. FINCA Pakistan added more than 200,000 savers to our network total by the year’s end. While all FINCA subsidiaries serve both women and men, in FINCA Afghanistan, 80% of our clients are women entrepreneurs.

Target demographics: FINCA provides small loans and other financial services to hardworking, impoverished microentrepreneurs to help them build small businesses so they can improve their families' living standards and give their children a brighter future.

Direct beneficiaries per year: over 1.7 million clients, impacting more than 8.2 million children and adults in their families.

Geographic areas served: 23 countries on five continents, serving clients in Africa, Latin America, Eurasia and Middle East/South Asia

Programs: Financial services, including Village Banking and small group loans, individual loans, savings accounts, microinsurance, money transfers, agricultural loans, Islamic microfinance products, microenergy loans, and other financial services for those who could not otherwise obtain them. Village Banking is distinguished from other microcredit methods by the responsibility and autonomy given borrowers in running their banks. Technical Assistance is provided to Village Banking groups to encourage savings and community development activities.

Community Stories

18 Stories from Volunteers, Donors & Supporters

5

Donor

Rating: 2

The administrative costs, particularly for the CEO, have become excessive. I'd been giving for the last two years, but will refrain from giving more until they get these costs under control. Check the 2014 990 form and you will see excessive executive salaries across the board.

4

Volunteer

Rating: 3

FINCA is more than poverty eradication because it help many people include my family to have independent lives and in deed FINCA help Micro,Small, and medium enterprises(MSME) in my community,
Through FINCA my government and non- government help to exploit opportunity in my country.

Thank God for create people who have good idea of start FINCA. GOD BLESS FINCA,GOD BLESS TANZANIA


I have nothing to offer to FINCA but GOD BLESS YOU ALL

15

Donor

Rating: 5

A few years ago my husband and I had the privilege of being escorted by a staff member of FINCA International to three micro-lending community groups when we were in Otavalo, Ecuador. We attended two different meetings and talked with group members about their projects and their participation in the FINCA micro-lending group. We also visited several of the projects: a sewing collective, a chicken project and a pig raising project. The pride and energy of the participants was palpable. The success of these - mostly women -entrepreneurs and the influence they gained both within their families and in their communities addressed important social issues of gender equality as well as economic issues.

My husband and I returned home to the US feeling proud to be supporters of FINCA and motivated to continue our support.

1

Professional with expertise in this field

Rating: 4

FINCA is about changing lives, building hopes for a brighter and better future. FINCA loans has touched the lives of many Afghan families, it has enabled Afghan entrepreneurs to create job for them and their surroundings.

FINCA loan has brought hopes to the families and children of some of those families to go to school now and see the future colorful.

Thank you
FINCA

1 Jan_49

Donor

Rating: 4

When so much government aid can go astray it's great to know that money (from FINCA) is getting into the hands of the people who can really use it to transform their societies one small step at a time.

4

Donor

Rating: 5

Loaning ambitious people money to build their own roads out of poverty makes sense to me. I like to hear about women being able to see their creativity and drive benefit their families. That's what we like to do. I think FINCA does a good job of getting money to the right people.

14 Craig27

Donor

Rating: 5

A number of years ago I did extensive research on the impact various approaches have to cyclical poverty and global population growth, both of which I consider to be root cause factors in many of our challenges. Empowering small primarily women based businesses in a disciplined approach to business is perhaps the single most efective way of impacting things. FINCA's structure makes it very difficult to compare to other microlenders. While FINCA was once in a class all by itself, I cannot fault those who choose Accion instead. I still prefer FINCA because their approach not only fuels individual entrepreneurs, it also sets up what are in effect micro business management schools in the form of its local micro banks. Also, for those that are troubled by FINCA's overhead expense numbers, these are distorted much in the same way Accion's are. Both organization have umbrella organizations, and then local arms that are structured as separate entities. So for both, the overhead percentage of the umbrealla is grossly distorted upward. If you look at them on a consolidated basis, both are running around 95% +/- 1% of their funds going to their charitable purpose. IRS form 990 does not reflect this. So FINCA will continue to get my very strong support. I only wish I could give them more.

16

Donor

Rating: 2

I have read the reviews and I too do not want to donate to a charity where the CEO and board members receive way too high compensation.

21 Peter20

Donor

Rating: 5

93% of donations goes directly to clients, providing micro-loans, primarily to women. Plenty has been written recently about unscrupulous microfinance organizations who tempt people to overextend themselves and then squeeze them dry. FINCA's rate for in-arrears more than 30 days is a very conservative less than 1.5%, of which less than 1% is eventually written off. In addition to the individual loans, FINCA's model is to build village banking organizations wherever they lend, with more and more of the lending done by locals over time.

23 David75

Donor

Rating: 2

Like others on this review, I agree that the administrative costs, particularly for the director, have become excessive. I'd been giving for the last three years, but will refrain from giving more until they get these costs under control. Also, why pay board members?

Review from CharityNavigator

25

General Member of the Public

Rating: 2

I haven't donated to FINCA since I saw a financial statement several years ago. FINCA's administration appears to be quite fat. The admin expenses are high, the Executive Director's salary is very large, and at least one board member (founder J. Hatch) is paid a very large salary for part time work. I'd prefer to have my donations more efficiently leveraged in a leaner organization. Now that micro-finance is an established development technique there a number of more efficient alternatives.

Review from CharityNavigator

20

Donor

Rating: 5

I suggest that a bit closer assessment of their historical record reveals that it is not so much an “inordinate increase in administrative costs”, but that, after a surge in revenues – from the mid-$30Ms in ’02 –’03 to more than double in ’05 – ’07 (+$77M in 2007), revenues dropped abruptly in 2008 and ’09 (last year shown.) It would not be that much of a surprise if they had in the interim accordingly ramped up operations. It is presumptuous to assume that “administrative expenses” are all ‘office paper- pushing”. Note that they do not have any “payments to affiliates”; I.e. They develop and expand their own in-country core of on-the-ground program managers in the countries they serve, and would understandably be reluctant to strip down their organization too far-- too fast. In fact, their program outlays shows a smoother curve then their revenues; i.e. they did not immediately spend everything as received. With the result that the admin. expenses, as a percentage of program expenses has stayed relatively stable: 13% in 2003, 18% in 2002 vs. 19% in 2009 and 13% in 2008. Given the whipsawing this charitiy (and others) have received on the revenue side of things, it is amazing that they are maintaining business as well as they are.
I would ask you not to abandon these folks now. Keep an eye on the trends but don’t assume that they have abandoned their principles and fiscal discipline when they are having to navigate through this difficult stretch.

14

Donor

Rating: 2

I agree with earlier comments regarding the inordinate increase in administrative costs in what used to be a very efficient program. While I totally agree with their goals, I have a problem with internal costs. There are other charities that perform similar work that are far more efficient.

I have been a contributor for about 10 years and relied on past performance to decide on donations. Then, recently, oh, the spam! I started receiving an e-mail a day! No one ever asked me if I wanted to be on FINCA's mailing list. Then I checked their website, and it is all about donations and how I can benefit from tax deductions, etc. not what good my contribution is doing. Their whole focus seems to have changed. I have decided to donate elsewhere.

Review from CharityNavigator

1

Donor

Rating: 5

I LOVE FINCA and all the great work they do! It really creates positive impact on a global level. What I like most is the fact that they really work towards longterm goals. They are not a simple charity, they give a HAND UP out of poverty and thus educating people how to manage the little they have. Their Village Banking model is something really amazing! Way to go FINCA!

7

Donor

Rating: 3

I am disappointed to see that administrative costs have jumped substantially, which has directly impacted the % going to programs. I fear that this once excellent and inspired program is now lapsing into greed of administrators, with a loss of vision of what this charity was all about: helping those less fortunate, rather than those most fortunate. Although I already partially donated my annual gift (before reviewing here), I will have to seriously reconsider whether to donate the balance of my customary donation this year. I'm sorry to have to say that. My ratings of the charity have diminished accordingly.

Review from CharityNavigator

1

Donor

Rating: 5

As an Alumni to the Junior Chamber of Commerce and a former Rotarian I have developed a knowledgeable understanding of the importance of Capitalistic application and service above self. As a Small Business Owner, I think it is wonderful to be able to help women in another country realize their dreams for their own business.

Review from CharityNavigator

1

Donor

Rating: 5

I completely support this not-for-profit organization. I receive emails every two or three days with stories about how microfinance through this organization has changed specific women's lives. I appreciate that there are faces and names to this simple action with HUGE results. It let's me know that everyone backing FINCA is supporting something life changing and truly amazing.

1

Donor

Rating: 5

I love what FINCA does and how they do it! I feel so empowering when I think about how my modest donations can help a woman start a business, expand her enterprise and, in turn, help others. I also love that the FINCA approach is so simple and direct. What a sweet model for reaching the powerless and turning their abilities into an astonishing array of products and services. I am a true fan!