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funding gap emerging markets
Mexico

SOFIPA 3

  • SOFIPA
  • Invest in a Financial Institution
  • + 732 other investors
  • With a loan from Sofipa, Digna bought a potato machine which boosted her business significantly. Will you help about 830 female entrepreneurs like Digna through an investment? It allows local partner Sofipa to provide group loans to women in Mexico. *EUR/USD exchange rate risk*

    €250,000
    Amount
    6.00%
    Interest
    18 months
    Maturity
    6 months
    Repayments
    USD
    Currency
    Amount€250,000
    Interest6.00%
    Maturity18 months
    Repayments6 months
    CurrencyUSD
      100%
      Fully funded in 30 days on 31 May 2023.

      Summary

      Proudly, Digna shows us her potato machine. With this investment in her business, she increased the production of her botanas, typical deep-fried Mexican snacks. She now offers her customers crunchy chips in all shapes and sizes. When Digna started her business, she could only produce small amounts. Now, however, her business has grown into a wholesaler with a lot of clients. Digna invested her first loan from Sofipa in pasta and oil, because ingredients are always a major expense. Watch Digna's story in this video.

      Loans help entrepreneurs like Digna to grow their businesses. Thanks to your investments, small and medium-sized enterprises can generate employment for other workers in the region and support their families, next to their own. 

      This is highly necessary in the Southeast of Mexico, where Sofipa operates. Historically, this is the region with the highest disparities in the country and presents the highest poverty rates. These are the result of educational disadvantages, inadequate infrastructure, and limited access to basic services, all of which impede its development. Life for women in this area is even more difficult, which increases their disadvantage. A loan makes women more independent, creating equal opportunities and empowering them.

       

      What social return could your investment generate? 

      Your investment through Sofipa enables group loans to about 830 women. Group loans run on a 16-week (4-month) cycle, and per cycle, the women build a credit history that can later help them apply for a formal bank loan. On an initial loan, a group member can borrow a maximum of 7,000 Mexican pesos (340 euros), without collateral. The women guarantee each other, providing a strong social, supportive construct. 

       

      The story of Sofipa

      Financial inclusion is one of the problems the region of Oaxaca in Mexico is facing. The scarce offer of financial services specialized in reaching low-income citizens inspired the emergence of Sofipa in February 2004. With its existence, Sofipa contributes to financial inclusion and the region's overall development. 

      Sofipa started operating under the legal figure of the Cooperative Society. However, in search of being more competitive and innovative, in 2016, they decided to adopt the legal formation of an Investment Promotion Company, SOFOM, ENR. Read more about Sofipa on their company profile page. Since then, it has enabled at least 10.000 women to expand their businesses and improve the lives of their families.

       

      Sofipa in numbers 

      • Founded in 2004 
      • 467 employees
      • Loan portfolio of €13,968,857 (end of 2022), for female group loans
      • Approximately 10.000 credits to women a year

       

      USD Risk 

      Check the interest rate and maturity Sofipa offers you as an investor at the top of this page. For more information about possible exchange rate risks, visit our currency page.

       

      Company nameSOFIPA 3
      CEOFrancisco Diaz
      Founded2004-02-01
      LocationSan Antonio de la Cal
      SectorFinancial services
      Turnover$9,100,000
      Employees467
      Credit score3.31

      Impact

      97% of Sofipa’s clients are female entrepreneurs. Mainly active in the informal sector, the most significant need of these women is access to the financial system. 

      The goal of the Mexican microfinance institution is to end poverty by giving people growth opportunities and fight for gender equality by helping women to improve their income. They have been able to support more than 14,500 women so far. 

      Sofipa offers female entrepreneurs credit through group loans. Read more about how group loans work in the introduction blog post of Sofipa here. 

      Sofipa has a presence in 7 of the 32 states and is particularly active in two states with the highest poverty rates in Mexico, Guerrero with 38.41%, and Oaxaca with 33.49% of the national level.

       

      A study, conducted by 60 decibels, shows the following results of impact and customer satisfaction among Sofipa clients:

      ·         1.2 Inclusion Index (view here)

      ·         71% think that Sofipa is a good financing alternative

      ·         83% intend to use the loan to grow their existing businesses

      Research shows that women in emerging markets invest 90 cents of each extra dollar they earn in their families and immediate environments. This translates into better schooling, healthcare, overall lifestyle, and eventually, economic growth. 

      Providing female entrepreneurs with suitable financing options helps them overcome those barriers that keep them from starting or growing their businesses. Specific loan features that appeal to the typical female SME owner are longer-term loans, lower interest rates, alternative collateral, and repayment grace periods.

       

      SDGs impacted

      With this project, you are contributing to the following Sustainable Development Goals:

      SDG 1 - No poverty

      SDG 5 - Gender equality

      SDG 8 - Decent work and economic growth

      SDG 10 - Reduced inequalities

      Read more about the impact you can make through our platform and the SDGs on our impact page.

       

      Related blog articles

      • With this investment 10 jobs are created
      • With this investment 830 lives are improved

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      We have already contributed to SOFIPA 3

      Rafael Burguillos
      Hajé van Egmond
      Suzan van der Meij
      Alcanne Houtzaager MA
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      + and another
      732
      investors