Reflecting and pushing forward for impact: blog by Mirjam 't Lam

As we at Oikocredit reflect on 2021, we can be proud of the year we had. Despite the global pandemic, our partners, colleagues, investors and others in our global network, persevered in solidarity to support the low-income people and communities we serve.  

This was a year of financial recovery for Oikocredit: we had a positive result of € 15.3 million, compared to the loss of € 20 million we had in 2020.  

Most of our partners were better able to cope with the pandemic in 2021 and, in turn, could start paying their loans again. We therefore didn’t need to provide our partners with payment holidays (extended repayment periods) in 2021. In fact, at the end of 2021, we only had five partners remaining with payment holidays (compared to 69 in 2020) and of those five, four already started repaying their loans.  

We saw a lot more appetite for portfolio growth as the demand for new loans and investments increased in 2021. This means that our partners are able to continue to support their clients and pursue further opportunities that help vulnerable people and communities.   

Also, our member capital grew. This shows just how passionate and committed our members and investors are to Oikocredit’s work, which we are grateful for. It's through mobilising our investors’ capital into investments in partners that we can reach low-income people. 

Positive developments in the loan loss provisioning were also main contributors to our positive result as well as controlling our operational expenses. You can read more about this and other contributing factors to our positive result, in the annual report.  

Overall we’ve migrated back to more or less of our ‘normal’ or pre-pandemic portfolio, which is a good thing. 

Overcoming challenges and continuing to support our partners 

In terms of capacity building, we were pleased to able to start supporting our partners in person again, in the third and fourth quarter of 2021. Covid-19 restrictions made it difficult to travel to and meet with partners in the first half of the year. And although we continued to support them digitally, it’s important to be on the ground so that we can properly assess their needs.  

It has been incredible to see the flexibility and creativity that our partners have shown during the pandemic. A lot of them have had to adapt their business models and ways of working so that they can continue their businesses, and it’s very inspiring. 

For example, digitalisation (such as online and mobile banking) was already there, but it has really taken off since the pandemic. Our recent client self-perception survey revealed how ‘digital savvy’ our partners’ clients have become since the pandemic in order to persevere.   

At the same time, some of our partners are still seeing disruptions in their businesses. Agriculture supply chains, for example, are still having difficulties. So we have to continue to monitor our partners’ needs as the world changes and as other issues arise that have a larger impact on economies.  

Exciting endeavours for our new 2022-2026 strategy  

Despite people’s ability to adapt, the pandemic has affected the poor more than the rich, causing an increase in global poverty. This makes our work more relevant than ever.  And there are other issues like the impact of climate change that endanger people at the bottom of the pyramid. There is a profound need for resiliency among low-income communities and we’ve realised that if we want to further help improve the quality of life of low-income people and communities in a sustainable way, there is more work to be done by us and our partners.   

We’ve seen that resiliency is best strengthened at the community level. And after listening to our partners about what their clients’ biggest needs are, we have decided to work with them on community-focused projects that include water, housing, sanitation and community infrastructure, as part of our new 2022-2026 strategy.  

Our partners are the true experts in these areas, so working closely with them on this new community-focused approachis key.  

The majority of our work will continue in our existing sectors of financial inclusion, agriculture and renewable energy, but we want to provide a more holistic approach in order to make an effective and sustainable impact .  

All in all, with the stability we gained in 2021, we can feel confident as we go forward and explore new endeavours in 2022. And we remain grateful for the continued support of our global network and the passionate people who help make everything we do possible.  

Read the Annual Report 2021