Donate

Menu

Donate


Subscribe to our newsletter

Get updates, news and stories from our work around the world.

Follow Us

Search


550 West Van Buren Street
Chicago, IL 60607

Toll Free: 1-800-793-9455

© 2016 Opportunity Internationala 501(c)3 nonprofit.

News Answers

How do your interest rates compare to market norms?

Our interest rates are comparable to or lower on a risk/reward adjusted basis to what other organizations charge on typical microfinance loans in emerging markets. Because of the vast differences in transaction costs and sizes of microfinance loans from market to market, it is inappropriate to compare them to conventional loans. As noted by The Consultative Group to Assist the Poor (CGAP), “Administrative costs are inevitably higher for tiny microlending than for normal bank lending. For instance, lending $100,000 in 1,000 loans of $100 each will obviously require a lot more in staff salaries than making a single loan of $100,000.” Local money lenders typically charge interest rates that are 3 to 10 times what Opportunity International charges. According to one study, “The median informal rate charged by informal money lenders was 10 to 25 percent per month. Rates of 5 to 20 percent per day were reported in five countries.”

View all Answers

Subscribe to our Newsletter