US Microfinance: Small Loans-Big Results

Opportunity Fund is proud to release a new report: U.S. Microfinance: Small Loans, Big Results. Conducted in collaboration with the Accion U.S. Network, the report analyzes results from the first-ever nationwide survey of microloan borrowers in America.

The report measures outcomes from Opportunity Fund’s lending, and answers the fundamental question that drives our work: Do the loans we offer reduce poverty by helping the business owner to increase their own income and pay wages to their employees? We answered this question using the microTracker Client Outcomes Survey, developed by FIELD at The Aspen Institute, a think tank that has worked with more than 100 U.S.-based microenterprise programs.

Here are the key findings about Opportunity Fund’s microloan borrowers, one year after receiving the loan:

* 55% average increase in income earned through the business by the owner

* 4.9 jobs supported
(average number of jobs per business among businesses with employees)
* 2.9 jobs created/retained per loan
(includes businesses that are operated as a sole-proprietorship)

* 95% businesses survival rate

In short, Opportunity Fund is making prudent investments in California small businesses that are advancing the economic well-being of our Main Street entrepreneurs.

Microlending isn’t about making a loan just to get it paid back. That’s why you don’t see us touting our repayment rate as any indication of our impact (it’s 92%, thank you very much). At Opportunity Fund, we make loans in order to help the business owner get ahead. This report answers exactly that question – Was the business better off after receiving a loan?” The results are clear: Opportunity Fund lends to small businesses that are growing, boosting incomes and creating jobs. What more could you ask for with a $10,000 investment?

Combined with Opportunity Fund’s “Ripple Effect” report from 2011 which calculates the MACROeconomic impact of our microloans, Opportunity Fund has now produced the most robust body of evaluation work in the U.S. microlending field. This is cause to celebrate, and hopefully many of our supporters and investors will take great interest in this latest report!

Here’s a link to a summary of Opportunity Fund’s outcomes from this study.

Here’s a link to the full report, which can be found on Opportunity Fund’s publications page.

The regional outcomes for the Accion U.S. Network affiliates.

Keep up with us on Facebook and Twitter all week to see different findings highlighted each day!