Oikocredit’s € 2.1 million loan to Sofipa to benefit women in rural Mexico

Oikocredit’s € 2.1 million loan to Sofipa to benefit women in rural Mexico

Logo Sofipa.jpg30 January | 2024

New partnership agreement serves micro business in Oaxaca and Guerrero; supports women in underdeveloped rural locations.

Oikocredit is increasing its support to Mexico’s micro enterprises with a term loan of MXN 40 million (€ 2.1 million) to new partner Sofipa Corporation, SAPI de CV SOFOM ENR (Sofipa), headquartered in San Antonio de la Cal in the state of Oaxaca.

The new loan aims to support small businesses in marginalised communities mainly in the country’s southeastern states of Oaxaca and Guererro. According to the country’s National Council for the Evaluation of Social Development Policy (CONEVAL), both Oaxaca and Guerrero have large rural areas with significant levels of poverty.

Guerrero had about 60.4% of the population in poverty in 2022, CONEVAL data shows. The corresponding figure for Oaxaca was 58.4%.

Sofipa’s main product is group micro loans to women. Group micro loan lending, often referred to as village lending or group lending, offers a way for small groups of individuals to access financial services collectively.

About 80% of Sofipa’s customers for group micro loans are based in rural areas, and 90% are women.

Uplifting these two groups helps advance the UN’s Sustainable Development Goals 1, 5, 8 and 10.

The Oikocredit loan matures in November 2027.

Read the press release here

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