Frequently asked questions

Our FAQs offer answers to some most common questions on the coronavirus.

This information was last updated on 23 December 2021.

  • How have Oikocredit’s operations been affected by the coronavirus? How is Oikocredit managing the risks arising from the pandemic?

    Oikocredit is continuing its business activities. We continue delivering on our mission to support our partners, and the low-income people they serve, at a time when their need for support is even greater. Our management of the risks arising in the first year of the pandemic and its effect on our 2020 financial results were described in our 2020 Annual Report. In 2021 we were successful in rebuilding and rebalancing our loans and investments portfolio and supporting new partners. Read more here >

    With some economic uncertainty remaining in our focus countries, we continue to assess risks that could affect the value of our development financing portfolio. We keep our members and investors informed about the value of their investment in our online news and quarterly updates.

    We remain alert to developments related to Covid-19, such as the risk of new variants appearing. We have dedicated groups comprising Oikocredit Managing Board members and internal specialists who monitor:

    • the status of our investments in and loans to our partners in Africa, Asia and Latin America & the Caribbean;
    • questions and concerns from our members and investors, as well as investment and redemption flows;
    • our term investment portfolio and other liquid funds; and
    • general developments related to the pandemic, including its impact on the welfare and effectiveness of our staff working across the world.
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  • How has Oikocredit’s work with its partners been affected by Covid-19?

    We continue to be in close contact with our 517 partner organisations to ensure that we understand their evolving needs and to ascertain how Oikocredit can best help address them, particularly in situations where partners may face financial difficulty. Even in heavily pandemic-affected countries most partners are now coping well, but we are aware that this could change.

    After we granted payment holidays (extended repayment periods) to 113 partners during 2020 to ease their financial situation, the number of partners in this category reduced to 69 by the end of 2020 and have fallen to just five by the end of 2021. The vast majority of partners are now making their repayments according to schedule. See also: What effect has the coronavirus had on Oikocredit’s performance?

    Our online interactive partner portal, launched in 2021, has strengthened our partner monitoring, improved information sharing and sped up communications with partners.

    During 2020-21 we offered webinars and online encounters for partners, sharing advice on business continuity and cash flow, health and safety of staff and clients, understanding impacts on clients, stress testing, risk and scenario planning, and learning from sector leaders. See also: What role has capacity building played in Oikocredit’s response to the pandemic?

    Our partners responded positively to the support we provided, especially the smaller institutions. The external threats we have faced during the pandemic have brought our partners and ourselves closer together.

    In addition to our own efforts, Oikocredit has aligned with other impact investors in jointly coordinating our responses to Covid-19 challenges in support of our partners. In 2020 we committed to two joint initiatives to support the financial inclusion sector during the pandemic:

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  • How have Oikocredit’s partners and their clients been affected by the coronavirus?

    Many of our partners’ clients and members were unable to operate as usual for much of 2020 and 2021 due to Covid-19 and restrictions on movement and social interaction reducing economic activity. This was especially the case in the microfinance sector, less so in agriculture and in renewable energy. At Oikocredit we adopted special processes to assess, monitor and support partners more closely, just as our partners did with their clients. See also: How has Oikocredit’s work with its partners been affected by Covid-19?

    The situation improved during 2021, and very few partners still require support under special Covid-19 measures, but the future remains uncertain. We have seen differences between sectors and countries in terms of the severity and effects of the pandemic, its timing and duration, and measures taken by governments. New waves of the pandemic may occur, so we will keep monitoring the situation.

    We are concerned about global inequality in the distribution of anti-coronavirus vaccines. This is an issue that affects many partners and their clients. Humanity will remain at risk as long as some countries are largely excluded from the preventive benefits of vaccination.

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  • What role has capacity building played in Oikocredit’s response to the pandemic?

    As part of our proactive response to the coronavirus crisis in 2020-21, Oikocredit offered additional capacity building support to its partners. Initiatives included a webinar series on crisis management, virtual peer exchanges to allow partners to share crisis best practices with one another, and dedicated webpages of resources for partners.

    We also created a coronavirus solidarity fund and used this to help our partners provide extra support to their clients. In total the fund distributed € 77,212 to 39 organisations in 19 countries in 2020-21. Building on the fund, Oikocredit’s Innovation in Response to Covid-19 programme supports partners in developing adaptive solutions with the people they serve.

    In 2020-21 we re-engineered our capacity building programmes to run without in-person meetings. Since Q3 2021 we have returned to providing onsite and in-person capacity building for partners, partly replacing the online support we were restricted to during the peak of the pandemic. We have published the findings of our first client self-perception survey, which shows how partners’ clients have been impacted by, and dealt with, Covid-19 and other changes over the past 12 months.

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  • How have Oikocredit’s members and investors been affected by the pandemic?

    Our members and investors have shown great commitment to Oikocredit, and the vast majority have stayed loyal. A small number of redemptions and reduced inflow led to a minor decrease in member capital in 2020, but our investment base has remained stable. In 2021 members and investors provided an encouraging inflow of new capital, bringing total member capital back to close to pre-pandemic levels. See also: What effect has the coronavirus had on Oikocredit’s performance?

    Regular dialogue about inflow markets with the Oikocredit support associations has helped maintain our links to investors and has kept them informed about what Oikocredit has been doing to weather this storm. Since 2020 we’ve reported to investors on our financial performance (unaudited) on a quarterly basis, including on net asset value per share, and more broadly on the effects of the pandemic on our organisation and our partners. Since Q1 2021 we have also provided commentary on key quarterly ratios.

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  • How have Oikocredit’s staff been affected by the coronavirus?

    The health and safety of our employees have remained a top priority for us. As a global organisation, we have adhered to the public health guidelines issued by the authorities in all the countries where we work. We have good infrastructure in place for remote working, using digital tools for monitoring our partners and portfolio and for due diligence for new financing, and outside of lock-down periods have introduced hybrid home and office working arrangements at the Amersfoort office in the Netherlands. Managing competing home and work responsibilities has been demanding for many, however, and we remain committed to supporting the personal well-being of our staff.

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  • What effect has the coronavirus had on Oikocredit’s performance?

    Despite our best efforts, Oikocredit’s financial performance could not escape the consequences of the coronavirus and ensuing economic downturn in 2020, but our performance has showed resilience and recovered well in 2021. Oikocredit made a net loss of € 22.2 million in 2020 but then, through resumed growth, achieved a positive net result of € 15.3 million in 2021.

    Portfolio rebuilding has been successful. We closed 2021 with 17.8% net growth in our development financing portfolio to € 995.9 million (close to the portfolio size at the start of 2020: € 1,064.6 million). Net asset value (NAV) per share rose to € 213.58, also close to pre-Covid-19 levels. Portfolio at risk, represented by the PAR 90 percentage of loans with repayments at least 90 days overdue, closed the year at 5.5%, below the target threshold of 6%. Member capital has continued to recover after falls in 2020. With a return to growth in disbursements, net liquidity reduced in 2021 from 33.1% to 21.5%, still sufficient to support further lending and share redemptions.

    More details on 2021 are available in our latest Facts & Figures and the Oikocredit 2021 Annual Report.

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  • How has Covid-19 affected Oikocredit’s term investments and other liquid assets?

    Oikocredit’s treasury specialists monitor the assets we keep aside for liquidity management purposes. During 2020 we allowed our liquidity buffer, held in cash or term investments (bonds), to grow as a prudent response to the crisis and in case more investors requested redemptions. In 2021 we funded growth of the development financing portfolio by reducing the liquidity buffer to pre-pandemic levels, closing the year with net liquidity reduced to 21.5%, still sufficient to support portfolio growth and share redemptions.

    The term investments portfolio comprises investment-grade liquid bonds traded on public markets, which, due to being of relatively high quality, are less vulnerable than some other types of bonds to fluctuations in the financial markets. A significant part of the term investments portfolio is invested in ‘green bonds’, selected to support climate-related or environmental projects. In 2021 the value of Oikocredit’s term investments increased from € 182.8 million to € 214.4 million.

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  • Do you expect the coronavirus to continue to affect Oikocredit going forward?

    Oikocredit returned to profitability in 2021 following the loss in 2020 that was a consequence of Covid-19. While pandemic conditions have eased in many countries, forecasting the future remains challenging. Prospects for Oikocredit’s social investing remain positive, however, although we are cautious and vigilant about the economic outlook in our African, Asian and Latin American markets. Unequal and extremely limited access to Covid-19 vaccines in low-income countries could result in major new waves of the coronavirus. In addition, if governments in high-income countries reintroduce social mobility restrictions at any future time, a new global economic slowdown is possible. In addition, Russia’s invasion of Ukraine has resulted in even greater global uncertainty.

    We nevertheless aim to continue rebuilding the portfolio, based on our healthy pipeline of further credit and equity investments with current and prospective partners. Our close monitoring of market developments will include assessment of potentially rising interest rates and their possible impact on our term investments. Maintaining portfolio quality will be, as always, a priority.

    In December 2021 Oikocredit held its first ever Extraordinary General Meeting, mainly online. Members and others discussed the review of the cooperative’s capital-raising model and received an update on the development of the new 2022-26 strategy. We will take both of these key organisational changes forward in the coming year.

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