accelerating access to microfinance: unitus overview and results

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Accelerating Access to Microfinance: Unitus Overview and Results

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Page 1: Accelerating Access to Microfinance: Unitus Overview and Results

Accelerating Access to Microfinance:

Unitus Overview and Results

Page 2: Accelerating Access to Microfinance: Unitus Overview and Results

www.unitus.com 5

Why Unitus Exists

• What We Do: Fight global poverty– We decrease poverty by increasing access to microfinance

• Our Strategy: Accelerate the growth of microfinance– We select and partner with early-stage, high-potential

microfinance institutions around the globe– We provide the technical and financial support that enables these

organizations to grow faster, and reach more of the world’s poor

• Our Impact: 1.4 Million+ empowered– Our global portfolio of microfinance partners is reaching more than

1.4 million micro-entrepreneurs with affordable and life-changing financial services

Page 3: Accelerating Access to Microfinance: Unitus Overview and Results

www.unitus.com 6

Where We Work

As of January 2007, Unitus has 13 partners

Page 4: Accelerating Access to Microfinance: Unitus Overview and Results

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Unitus by the Numbers

1,400,000 Families empowered with access to microfinance

13 Worldwide partners in our portfolio

3 New countries represented in our portfolio in 2006,representing almost 70,000 new clients

94 Dollars – the average loan size offered to small entrepreneurs by Unitus microfinance partners

94 % Women – the Unitus portfolio of partners empowers over a million women with life-changing financial services.

109 % Annualized average growth rate of Unitus partners

“The work of Unitus as a microfinance accelerator is both complementary and consistent with the work of Grameen. We applaud their strategy.”

Muhammad Yunus, Founder & Director of The Grameen Bank Winner of 2006 Nobel Peace Prize

Page 5: Accelerating Access to Microfinance: Unitus Overview and Results

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Most Microfinance Institutions (MFIs) are small

To date, the MFI industry has failed to develop a systematic and sustainable growth model.

Page 6: Accelerating Access to Microfinance: Unitus Overview and Results

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Why Don’t MFIs grow?

Lack of Capital

• Banks won’t lend because of negatively perception of MFIs as unprofitable and undisciplined

• Most are unregulated nonprofit organizations, prevents

– Building equity base– Optimizing use of commercial debt

for leverage– Capturing savings deposits

• Limited access and familiarity with local capital markets, except for the few top-tier MFIs

Lack of Capacity

• Weak corporate governance

• Lack of management depth

• Absence of management and strategic planning systems

• Insufficient business infrastructure

– MIS/Accounting– Technology– HR

Page 7: Accelerating Access to Microfinance: Unitus Overview and Results

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Unitus Acceleration Model

Page 8: Accelerating Access to Microfinance: Unitus Overview and Results

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Select

Due Diligence Components:• Market Opportunity: Supply/Demand, Social,

Political, and Environmental Considerations • Organization Life Cycle: Start-ups and mid-

market MFIs• Institutional Factors: Visionary Management,

Legal Structure, Track Record, Systems• Strategy and Mission: Poverty Focus,

Competitive Advantage, Marketing• Focus on Profitability and Sustainability:

Operating Model, Portfolio Quality, Financial Management

• Management’s dedication to collaboration and commitment to growth

Identifying favorable markets and selecting high-potential MFI partners.

100

50

7

5

2006

Page 9: Accelerating Access to Microfinance: Unitus Overview and Results

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Consult

Capacity-building to prepare MFIs for rapid, long-term, profitable growth

• Improve corporate governance– Ensure local board oversight; Unitus board participation

• Expand depth of senior management– Evaluate organization structure– Assist with establishment of hiring and training systems

• Strengthen reporting and strategic planning processes– Implement Monthly Management Reporting and Balanced Scorecard– Support adoption of industry best practices (e.g. CGAP reporting standards)

• Facilitate capacity-building consulting projects– Improve MIS/Accounting systems and technology– Implement performance and human resource management systems– Expand product offering for target customer base

Page 10: Accelerating Access to Microfinance: Unitus Overview and Results

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Invest

Page 11: Accelerating Access to Microfinance: Unitus Overview and Results

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Catalyzing Rapid Growth

** Peer group MFIs (based on those who began the year with less than 100K clients, and who had reported to client numbers for at least two consecutive years)

Unitus is the fastest growing network in the industry; our microfinance partners have more than a 109% annualized average growth rate.

Average Clients Added Per Year Unitus MFI Partners vs. Industry

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

2003 2004 2005

Clie

nt G

row

th

Microfinance Industry Average** Unitus Portfolio Average

2x Industry

4x Industry

8x Industry

Page 12: Accelerating Access to Microfinance: Unitus Overview and Results

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Unitus Outreach in India

2004 2005 2006 Projected 2007

0-50k clients

50-100k clients

100-250k clients

>500k clients

250-500k clients

150,000 clients 430,000 clients 1 million clients 2.6 million clients

Unitus penetration in India has grown both in breadth and depth

Page 13: Accelerating Access to Microfinance: Unitus Overview and Results

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Where We’re Going…

Our Goal for 2007: Double our outreach

2006 11 Partners: 1.3 million empowered

2007 22 Partners: 2.6 million empowered

PROJECTION

FY 07

2,500+25,000+

245,000+

540,000+

1,000,000+

2,000,000+

1,300,000+