Cordaid Investment Management has recently disbursed the third loan to Fundenuse SA, an MFI in Nicaragua with a strong social mission to support micro and small entrepreneurs. Fundenuse has a solid market position due to its focus on the rural areas (over 57% of their portfolio), which are avoided by competitors.
Small business owners and farmers in those marginalized areas were hit the hardest by years of extreme weather, provoked by climate change, social-political crisis, and then finally the Covid-19 pandemic. But local banks do not rush to offer credit. In the times like this only pro-social institutions like Fundenuse are there to provide financial access. For example, although the agriculture sector and especially coffee in Nicaragua is considered quite risky to finance, Fundenuse supports the coffee industry and its small farmers.
“Fundenuse has been a partner of Cordaid since 2016. This MFI with a rural focus and a considerable agricultural portfolio has a strong market position in the North of Nicaragua. As of February 2021, it had 18,566 loans outstanding, with a portfolio of approximately EUR 12.8 million. It is a well-established organization that has shown dedication and capacity to serve its clients at a time when Nicaragua is facing many problems", explains Gauke Andriesse, Senior Investment Manager at Cordaid Investment Management.
Moreover, Fundenuse SA offers various tailor-made products to underserved populations, ranging from rural production chains to individual housing to water sanitation loans. Financial solutions go hand in hand with free training given to their customers on topics such as financial literacy and sustainable agricultural best practices.
During the five-year partnership, Cordaid Investment Management has witnessed the gradual growth of the MFI. Since 2016 Fundenuse opened 6 additional branches, now having 21 offices (14 rural and 7 urban), 169 employees and corporate governance committed to social performance. Furthermore, it was awarded Client Protection Certification from The Smart Campaign (Center for Financial inclusion).
"Throughout the years Cordaid Investment Management has been an important ally that has contributed to the achievement of the mission and vision of Fundenuse. With the financing received we have reached thousands of microentrepreneurs and farmers in the rural areas of northern Nicaragua providing access to microcredit as a financial inclusion tool that improves the quality of life of the most vulnerable populations. Thanks for trusting us," says Ada Eveling Rivera, General Manager at Fundenuse SA. Through partnerships like this Cordaid Investment Management shows that social mission goes side by side with financial stability.