Opportunity International, one of the world's largest microfinance organizations, announced it received a $1.2 million grant from the John Deere Foundation to provide increased access to financing for the hunger-afflicted in Africa.
Through Opportunity International's unique financing model, the grant will have a $10.6 million economic impact over the next three years. It will benefit thousands of farmers, food processors and retailers and their ability to provide affordable food to the rural poor in Malawi and Mozambique.
The John Deere Foundation grant will enable Opportunity International to implement low-cost, technology-driven programs that provide a full range of microfinance services to poor families living in rural areas in Malawi and Mozambique. The goal of the joint project is to create a sustainable framework in Africa to increase food production, food availability at local markets and family income for food.
"Our alliance with John Deere will allow us to dramatically expand access to capital and financial services for underserved populations in Malawi and Mozambique," said Christopher A. Crane, president and chief executive officer, Opportunity International. "Microfinance contributes to poverty alleviation and food security by supplying loans, savings and microinsurance that enhance investments, reduce the effect of shocks such as illness of a wage earner, bad weather, theft or other such events, and lead to an increase in food consumption."
Over the next three years, the John Deere Foundation grant will allow Opportunity International to open four new branch offices and finance 6,800 agricultural businesses ranging from fresh produce stalls at local markets to processing cooperatives and small maize farms.
Entrepreneurs receiving the loans will create 3,500 additional jobs. Altogether, 62,000 family members will benefit from enhanced food security with the increased income derived from these enterprises.
"We are excited about our new alliance with Opportunity International and look forward to the significant impact that will be achieved in Malawi and Mozambique," said John Bustle, vice president, John Deere Foundation. "These quality financial services will help thousands of people thrive as their agricultural and food-related businesses develop and will result in significantly increased food supplies for countless others."
Due to Opportunity International's unique business model and repayment rate of 98 percent, the impact of the John Deere Foundation grant on the global food crisis will be substantial. As client loans are repaid, the money becomes available to loan again and again. Clients' savings accounts and borrowed financial funds add to the loan pool available to clients. Through the recycling of loans, mobilization of savings deposits and financial leveraging, the $1.2 million grant will amount to a total economic stimulus of $10.64 million over a three-year period.