Unitus and Bill & Melinda Gates Foundation Launch Microfinance Efficiency Initiative
Unitus Experts to Identify Ways to Improve Efficiency in Microfinance Industry
Redmond, WA—October 26, 2006—Unitus, Inc., an organization which creates innovative solutions to global poverty, and the Bill & Melinda Gates Foundation today announced a joint effort to study and improve efficiency in the microfinance industry. The results of the research will be shared across the industry to help microfinance institutions (MFIs) operate more effectively and provide lower-cost services to their clients.
To implement this ground-breaking initiative, Unitus, with funding from the Gates Foundation, has hired four experienced financial analysts to find ways of improving operational and financial efficiency among MFIs in India, Latin America, and around the world. Over the next three years, the analysts will identify efficiency-enhancing measures such as reducing operating costs associated with MFIs, increasing employee productivity and creating systems to optimize treasury management, which will further lower the cost of capital for MFIs and interest rates for micro-entrepreneurs.
“Improving efficiency in the microfinance industry is essential to its long-term success,” said Unitus President and CEO Geoff Davis. “For an MFI, improved efficiency translates into better use of resources, faster growth, and significantly more of their micro-entrepreneur clients having access to life-changing financial services at lower cost. We are excited about working with the Gates Foundation as we help move the microfinance industry to its next level of success.”
Sandeep Farias, Vice President and Country Director of Unitus India, said, “This initiative was conceptualized to inculcate a culture of efficiency, not just in our MFI partners, but across the microfinance industry. The objective is to develop break-through innovations to help our MFI partners around the world become low-cost providers of high-quality microfinance products while achieving economies of scale. With the support of the Gates Foundation and an impressive team drawn from India, Latin America and the U.S., I am confident we will succeed.”
“It is our hope that increasing efficiency in the microfinance industry will result in greater access to these services for the poor and thereby help improve their lives,” said Sylvia Mathews, President of the Global Development Program at the Gates Foundation. “We hope this project will generate an important learning tool for the broader industry to significantly improve the way financial services are delivered to the poor and we’re proud to work with Unitus and its MFI partners on this landmark initiative.”
About Unitus:
Unitus, Inc. is a nonprofit organization creating innovative solutions to global poverty using a venture capital model. Unitus dramatically accelerates the growth of microfinance institutions (MFIs) and demonstrates that many MFIs can be run as profitable, large-scale, poverty-focused businesses with links to formal capital markets. As of September 2006, Unitus had 10 MFI partners worldwide serving more than 930,000 poor clients. By 2015 Unitus MFI partners plan to reach 10 million clients in India alone. Based in Redmond, WA, USA and with offices in Bangalore, India, Unitus relies on innovative financial instruments and the resources of like-minded individuals and foundations to fulfill its mission. Unitus received the 2006 Fast Company Social Capitalist Award for taking an innovative, business-minded approach to alleviating global poverty. For more information about Unitus, please visit: www.unitus.com.
About the Bill & Melinda Gates Foundation:
Guided by the belief that every life has equal value, the Bill & Melinda Gates Foundation works to reduce inequities and improve lives around the world. In developing countries, it focuses on improving health, reducing extreme poverty, and increasing access to technology in public libraries. In the United States, the foundation seeks to ensure that all people have access to a great education and to technology in public libraries. In its local region, it focuses on improving the lives of low-income families. Based in Seattle, the foundation is led by CEO Patty Stonesifer and Co-chairs William H. Gates Sr., Bill Gates, and Melinda French Gates. More information is available at www.gatesfoundation.org.