Creating more positive change! Interview with Dave Smit
Dave Smit, Oikocredit's Director of Impact Investments
In October 2022 Dave Smit joined Oikocredit as Director of Impact Investments. Here he reflects on his first 100 days and the fact that low-income people in developing countries are hit hard by global headwinds.
Dave notes: “Oikocredit was established to support peaceful development and global justice through values-based investing. Today, impacts on low-income communities of rising interest rates and inflation, inequality, poverty and climate change make Oikocredit’s mission more relevant than ever. This is the time to step up efforts, build partnerships, focus on transformation and innovation, and help people and communities in developing countries build resilience. Oikocredit is uniquely positioned to drive this positive change!”
Two key experiences
Dave has been much impressed by two partner visits during his first 100 days.
“In Ecuador we visited a woman entrepreneur running a small artisanal bakery. With her loan from our Ecuadorian financial inclusion partner Banco VisionFund Ecuador she bought bread ovens. And with the income from selling her bread she could send her children to school, although she had never received any education. Our partner’s small investment has made a tremendous difference to this family.”
In India, Dave visited a social impact company that Oikocredit’s Indian subsidiary, Maanaveeya, plans to work with. “This company hires and trains mainly people with disabilities for supporting back-office functions of mainstream organisations like hospitals and banks. By providing training and equipment tailored to its employees’ needs, the company creates jobs for people who would otherwise have difficulty finding jobs. The staff are highly motivated and deliver the highest quality of services.”
“The impacts we realise through our partnerships, like these excellent examples, motivate me,” says Dave. “I want us to achieve more!”
Dave has found the cooperative fully committed to put capital to work to accelerate positive change. “Oikocredit directs financial flows in the right direction. And by working with partners the impacts of our efforts multiply,” he says. He is enthused by the drive and engagement of the Oikocredit community.
“The range of Oikocredit partners is extensive,” he says, “from mature and well-developed microfinance institutions to cooperatives that support coffee and cocoa farmers, to innovative small-scale renewable energy solution providers. We increasingly support early stage, innovative technology-based partners with tremendous social impact potential.”
Oikocredit itself also faces the headwinds, Dave acknowledges. Interest rates and premiums for local currency finance have become much higher and more volatile. This is not unique to Oikocredit and plays out across the sector. However, through our local networks we have plenty of interesting investment opportunities.
Dave: “We stay true to our mission as a responsible impact investor, balancing long-term impact, risk and return.”
Among Oikocredit’s key strengths are its mission-driven approach and proximity to markets and the people it wants to support. The number of people we reach through our partners has risen impressively to almost 40 million. And we are among the first impact investors to undertake end-client self-perception surveys with our partners to measure the impact of our work on beneficiaries.
Investing in sustainable innovation
Oikocredit helps sustainable and innovative entrepreneurs with loans, capital and capacity building to achieve growth. We were the first international financier for many of our partners and continue to support them as they develop. Some partners have matured and can attract more funds from a wider pool of mainstream international impact investors.
So … is Oikocredit still necessary? Dave: “Our cooperative is more needed than ever. Our strategy focuses on increasing impact and innovation, more partnerships and improving portfolio income.” He believes we must continue effectively supporting our longstanding partners, while engaging with new partners in groundbreaking financial inclusion, agriculture and renewable energy initiatives.
“In our partnerships we aim to be at the forefront of the sustainable transition and to positively support long-term change in the lives of low-income people and communities. That's how we will increasingly make a difference.”
Adding value and staying agile
Dave is committed to maintaining Oikocredit's pioneering and innovative role: “We want to operate where we can add most value and truly accelerate resilience of low-income communities.”
He is excited to anticipate the social and economic results when a remote village in Africa gets access to clean cookstoves or renewable energy: “The village no longer needs to cook on charcoal or wood, or to use kerosene lamps. So its people become safer and healthier, and together we help protect the forests. It is a privilege to be part of achieving this impact.”
Dave continues: “Having travelled internationally in my previous positions, I've seen that talent is equally distributed worldwide but opportunities are not. Giving more people equal opportunities drives me.”
Oikocredit’s new strategic community-focused approach is important: “Our partners’ support for end-clients matters, and by supporting the communities they live in we can have greater and more lasting impact. This is why we are teaming up with strategic allies.”
“What I hope to bring to Oikocredit is enthusiasm and energy,” Dave adds. “I also bring development financing experience – 20 years in various capacities. And I identify with the need to be agile and adaptable, because we’re operating under challenging circumstances. With the Oikocredit team and our partners we are very well positioned to co-create more positive change with and for low-income people in developing countries. Count me in!”
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