There is a great need to build trust in financial institutions among South Africans, who are often denied access to credit from regular commercial banks. With 31.3 percent of the population living below the poverty line and 10 percent of South Africans holding 80 percent of the country’s wealth, those at the bottom of the economic pyramid lack meaningful access to formal banking services.
Opportunity South Africa started in 2006 in response to the country’s socioeconomic inequality and the high potential of its small and medium enterprises (SMEs). By equipping entrepreneurs with the tools they need to bring employment to their communities, Opportunity International aims to be a key player in eliminating poverty in South Africa. Headquartered in Pietermaritzburg, we serve areas of the Kwa Zulu-Natal province where unemployment and extreme poverty are commonplace.
Opportunity South Africa operates 10 branches that provide a variety of services to SMEs, including:
SME Loans: Opportunity South Africa supports talented enterprises with loans that generate employment opportunities within their respective communities.
Rural Expansion: Opportunity South Africa is focused on expanding its distribution network into rural townships through kiosks located in building supply and hardware stores—places where clients purchase equipment and supplies. Additionally, Opportunity South Africa now offers mobile banking.
Solar Water Heating (SWH): The global use of SWHs is driven by the socio-economic need for job creation, environmental concerns, energy security, national economy and peak demand reduction. Opportunity South Africa has entered into a partnership with a supplier of solar-powered water heating systems. We finance these solar water heating systems for our low-income clients.
Education Finance: Opportunity South Africa designed and launched the school fee loan product in response to the low rate of kids in school within the rural communities surrounding Pietermaritzburg and Durban. School Improvement loans are also available.
Opportunity International is closing this project and rolling it into a broader project that includes South Africa in addition to 7 other African nations in need of our help and financial services. Africa is home to 24 of the 25 poorest countries in the world, and 75% of its population lives on less than $2 a day. With this project, we are able to provide financial services to the poorest of the poor in Africa in a more impactful way. Please now see the project "Banking on Africa" number 7660.
With 43% of the population living on less than $2 per day and 10% of the South Africans holding 80% of the country’s wealth, those at the bottom of the economic pyramid lack meaningful access to formal banking services. Currently, Opportunity South Africa operates 10 branches that provide a variety of services to SMEs, equipping entrepreneurs with critical microfinance tools that build successful businesses, generate employment and create thriving communities.
In 2013, Opportunity South Africa has a fundraising need of $526,520. Funding will enable Opportunity Finance South Africa (OFSA) to launch School Proprietor loans in 2013 and increase rural expansion and outreach efforts.
Education Finance –OFSA designed and launched the School Fee loan product in response to the identified need within the rural communities surrounding Pietermaritzburg and Durban. The newly piloted School Fee loan portfolio is very healthy with a PAR>30 of 1-2%. In 2013, OFSA is set to launch School Improvement loans.
SME Loans – Opportunity South Africa supports talented enterprises with loans that generate employment opportunities within their respective communities.
Rural Expansion – Opportunity South Africa is focused onexpanding its distribution network into rural townships and has opened five kiosks. These kiosks are located in building supply and hardware stores as these tend to be focal points where clients purchase equipment and supplies. The first of these kiosks, based in Hammarsdale Township, paid out 12 loans, valued at $15,000, in its first month of operation. Additionally, OFSA launched its first mobile bank in 2012.
Eleven of Opportunity South Africa’s Pietermaritzburg branch clients are members of the Gcumisa Cooperative, six men and five women. The Gcumisa Cooperative is located in a rural community outside the small town of Wartburg. The main crop of this area is sugarcane and most of the land is leased out to growers by the village chiefs. Zulu is the language spoken in this community where families live in traditional round huts without the benefit of running water.
The Gcumisa Cooperative farmers grow potatoes and maize. Thanks to your generosity, since receiving their first loan of $300 each, have increased their harvest enough to open a produce stall in the busy Durban marketplace.
Nora, (left) the group’s chairlady, grows maize; her neighbor Norgusa (blue dress) is her friend and a farmer as well. The cooperative farms 60 hectares between them. Each member also plants a plot to provide food for their families. Today, the group is on their fourth loan which they used to purchase high quality seed and fertilizer. The members are each turning a profit and have agreed to use future loans to purchase a tractor and fund an irrigation system so they can increase their production.
Unlike many microfinance organizations, we believe that financial services should not be accessible only to those in the big cities. Many living in rural communities of South Africa live hours from the nearest bank, ATM, or store with credit access. That's why we're using innovative technology to give even the most rural clients acess to loans, savings, and credit.
Using Available Technology
For decades, commercial banks have avoided serving people living in poverty, especially in rural areas, because of the high cost of processing small transactions. In contrast, Opportunity has invested more than $20 million over the last 10 years in the use of electronic and mobile technologies to reduce transaction costs and bring services to the most marginalized and remote clients. By establishing low-cost satellite branches and deploying ATMs, point-of-sale (POS) devices and mobile banks in outlying areas, banking services are provided to people in their own communities.
Capturing clients’ biometric information provides convenient and secure access to finances, even for those who are illiterate or lack formal identification. When clients open an account, their fingerprint is scanned and stored in the bank’s system, enabling electronic transactions at retail and ATM locations. New technologies use cell phones, and satellite and broadband Internet to further increase Opportunity’s reach in South African communities, as well as other rural communities across Africa.
Thank you for your generosity that allows us to keep on reaching the most marginalized people!
There is a great need to build trust in financial institutions among South Africans, who are often denied access to credit from regular commercial banks. Less than 35 percent of the people hold formal employment, and poverty is rampant at the bottom of the economic pyramid.
Opportunity South Africa started in 2006 in response to the country’s socioeconomic inequality and the high potential of its small and medium enterprises (SMEs). By equipping entrepreneurs with the tools they need to bring employment to their communities, Opportunity aims to be an important instrument of poverty alleviation in South Africa.
Headquartered in Pietermaritzburg, Opportunity serves areas where unemployment hovers at 40 percent and people live in extreme poverty. In just three years of operation, Opportunity South Africa has achieved strong growth and now operates five branches.
Statistics About South Africa
Population: 49 million Population living below poverty line: 50% Life expectancy: 49 years HIV prevalence: 18% Population in formal labor force: 35%
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