The project

Q: What does the higher interest rate of this project mean?
A: The project is part of a pilot program where we experiment with the conditions of projects. The higher interest rate is not due to a change in the credit rating, which remains an A. The increase in interest is not paid by the financial institution or the entrepreneur.

Oliva's couture atelier, a family business in Oaxaca that has been around for 40 years, specializes in creating traditional Mexican clothing. A craft passed down from generation to generation, now to her son as well. Thanks to a group loan from Sofipa, she was able to purchase fabric and thread, and hire staff, leading to growth. She is part of a network of female entrepreneurs who support and work together to develop their businesses.

Step into Oliva's atelier…

Loans help entrepreneurs like Oliva 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 664 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. 

What financial return could your investment generate? 

• Annual interest rate of 8%
• The maturity of the loan is 18 months
• With an investment of 1,000 euros, your expected total repayment would be 1,080 euros
• Please consider that although you invest in EUR, the loan is in USD, so there is a risk of exchange rate fluctuations between dollars and euros. For more information on potential exchange rate risks, please visit our currency page.

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