We give loans instead of grants as we believe that loans are more effective for achieving economic productivity. Loans create a real business partnership based on mutual respect.
Our financial products
- Loans: the loans are for working capital and portfolio growth of microfinance institutions and small to medium enterprises. The loans range between EUR 250,000 to 10,000,000 or the equivalent in local currency based on the partners’ needs and profile.
- Credit lines: We provide credit lines are generally shorter term, more flexible loan arrangements.
- Letter of credit: we can issue letters of credit for qualifying microfinance institutions and small to medium enterprises that cannot access local funding without a third party guarantee.
- Term of the loan: From 1 to 6 years for a local currency loan and up to 10 years for a loan in Euros or US Dollars
- Grace period: A grace period of 3 to 12 months of capital payments can be offered based on the needs of the borrower
- Interest rate: Reasonable and variable considering the market rates for comparable transactions as well as the risks and development relevance of the project.
- Securities: Suitable securities are required from the borrowing institution and its representatives to ensure serious commitment to the success of the undertaking
- Arrangement fee: Oikocredit charges a standard arrangement fee of 1% of the total loan amount.