Invest in your values Bernard Horenbeek, Director Credals civic - - PowerPoint PPT Presentation

Invest in your values

Bernard Horenbeek, Director

Credal’s civic roots

Crédal’s civic roots

• Early 80’s.
• Bank-apartheid movement: struggling against that

system implies the withdrawal of our financial support !

• Crédal’s creation (CREDit Alternatif) in 1985 , as a

cooperative.

Who’s Crédal?

Shareholders

• 1500 shareholders :

– Want their money to finance socially value-added projects. – Take « shares in the cooperative » (with

• r without dividends).

– Legal or natural persons

Shares of the cooperative

2008’s dividend : 2,25%

with dividends / month no dividends with dividends

The cooperative’s philosophy

Crédal, better than a bank !

• Financial cooperative for solidarity
• Our customers are our Partners
• An organization of third sector
• Shareholders’ parts for individuals and third sectors
• rganizations seeking for socially value-added financial

investments.

• 15,000,000 € of equity.
• A social purpose.

Crédal’s activities

Personal Microcredit Management consulting for social projects Affaires de Femmes, Femmes d’Affaires Professional Microcredit Credit for Social Organizations

CREDAL

Microfinance: history and objectives

History and objectives

• 2000: Business start-up micro-loans –

MC2

– 2004: Social consumer lending

• Objectives :

– to offer access to loans tailored to the beneficiary’s needs for start-ups or to improve the recipient’s everyday comfort – Personalised support

• Social performance indicators

Professional microcredit

Professional microcredit

• Creation or development of a professional

activity.

• For future entrepreneurs facing financial

exclusion.

• Specificities:

– 12.500€. – Refundable in 4 years maximum. – 5 % interest rate.

Professional microcredit

Crédal’s « + » :

• Human and personalized relationship.
• Advice and continuous support.
• Solutions adapted to the project and to its

leader

• Flexibility.

Chris Derudder benefited from a professional microcredit to start his catering project

« I am fascinated by the cooking for a long time. I like to say that my job is also my hobby, my passion and represents all my life. I have the possibility

• f

living

• n

this passion. »

Some figures …

2008 2009 First calls 1.010 1.080 Files 220 173 Files presented to our credit committee 109 103 Accepted files 83 58 Average amount 7.688€ 7.688€

Personal microcredit

Personal Microcredit

• Consumers credit that maintains or improves daily

life.

• For people with low incomes, facing financial

exclusion.

• Specificities:

– 10.000€. – Refundable in 4 years. – 5% interest rate.

The personal microcredit

• The social green loan :

– 0% interest rate. – For people who wish to realize energy savings. – The credit is released according to the needs.

• Loan for family reunification:

– For immigrants willing to gather their family in Belgium.

Personal Microcredit

Credal’s « + » :

• Human and personalized relationships.
• Prevention of over-indebtedness.
• Budget advices.

Rex Nkangala reunified his family

« Mes enfants ont entre 6 et 16 ans et sont maintenant scolarisés à Bruxelles. Ils se sont tous bien adaptés dans leur nouvelle école. A leur arrivée, ils ont été surpris par le froid et le peu d’heure de clarté. Je les ai vite rassurés en leur disant que ça ne serait pas toujours comme ça, les beaux jours vont revenir… Pour moi, les beaux jours sont revenus le jour de leur arrivée en

• Belgique. »

Some figures

2008 2009 First calls 1.521 2.245 First interview 530 813 Accorded credits 258 476 Average amount a 4.291€ Loss ratio 0.4% 0.4%

Social performance indicators

• Target population
• Products tailored to the needs of

target groups

• I. Target Population

– People with low income who are excluded from traditional bank loans or for whom the loan proposed does not correspond to their needs. – People who want to become self-employed but cannot obtain financing from a traditional bank. excluded from traditional bank loans (low income, lack of a guarantee, bad credit history, age, health, etc.)

– Family situation

43% 27% 3% 20% 7% Single Single with dependent family Couple Couple with dependent family Cohabiting (at parents, etc.)

– Origin of main resources

Main ressources 9% 5% 4% 15% 6% 30% 18% 5% 2% 4% 2% Art 60 Full-time casual work Part time casual work Full-time contract of indeterminate duration Part time contract of indeterminate duration Unemployment benefits Minimum welfare payment Sickness benefits

– Welfare recipients/workers

39% 61% Workers Welfare recipients

Sectors financed and types of loans: amounts, duration, interest rate Post-credit support, for business start-up micro-loans Specific experiences: social green loans and loans to migrant populations

• II. Products tailored to the

beneficiary’s needs and situation

• Sectors financed by business start-up loans:

– Retail trade, craft enterprises and personal services at home, transport, “horeca” (hotels, restaurants and cafés), to finance investments, inventories, initial working capital needs, etc.

• Objects financed by social consumer loans:

– Second-hand cars, scooters, driving licences, household electrical appliances, furnishings, work, health care costs, etc.

• A. Sectors financed

Business start-up micro-loans

• Maximum: €12,500
• Interest rate: 5%
• Duration: maximum 48 months

Social consumer credit:

• From €500 to €10,000
• APR: 5%
• Duration: from 3 months to 48 months

Types of loans

Post-credit support for business start-up micro-loans:

• Observation: once the financing has been
• btained, the venture begins
• Team of voluntary workers: one full-time

employee coordinates a team of voluntary workers

• B. Support

• Social green loans: loans at 0% for

investments in energy savings

• Loans to migrant populations: loans

tailored to progress in family reunification procedures

• C. Specific experiences

Business start-up micro-loans – 8 years

• 3800 initial telephone contacts
• 1200 individual meetings
• 366 micro-loans disbursed
• Total amount disbursed: €2,700,000
• Average amount per micro-loan: €7800

Social consumer credit – 4 years

• 4500 initial telephone contacts
• 3000 individual meetings
• 650 social loans disbursed
• Total amount disbursed: €1,900,000
• Average amount per social loan: €3000

Production

Business start-up loans

• Delinquency rate:
• Bad debt rate:

Social consumer loans

• Delinquency rate: 8% to 10%
• Bad debt rate: 0.4%
• Personalised debt recovery policy

Recovery and delinquent loans/bad debts

Conclusions

Bank access:

• Access to appropriate services
• Better informed and better equipped individuals
• People on low income are not bad debtors

Integrated model in Belgium

• Single structure (CREDAL) which acts as a lender and provides

support/advice Evaluation

• Importance of the quantitative evaluation and qualitative impact on

customers Funding

• The educational process is expensive
• Multiple sources of funding to ensure the long-term viability of the

system

Crédal’s team

Crédal’s team

• 32 employees and 75 volunteers.
• Offices in french-speaking regions of Belgium :
• Louvain-la-Neuve
• Brussels
• Charleroi
• Liège
• Namur

Thanks for your attention

Contact: nathalie.denis@credal.be bernard.horenbeek@credal.be +32 10.48.33.50 www.credal.be