Silicon Valley Microfinance Network February 24, 2009

Who Does Microfinance Serve in the U.S.? Low and Moderate Income Entrepreneurs Cannot access bank financing New business (< 2 years) No collateral Less than perfect credit Need small amounts of capital Cultural and language barriers Home-based businesses Dependent on income

Low and Moderate Income Entrepreneurs

Cannot access bank financing

New business (< 2 years)

No collateral

Less than perfect credit

Need small amounts of capital

Cultural and language barriers

Home-based businesses

Dependent on income

Microfinance in the U.S. Automotive Beauty Salons Childcare/education Cleaning Services Delivery Service Fitness and Recreational Sports Centers Food retailers and Grocery/Convenience stores Household / supplies / repair Landscaping Manufacturing Music, Photography, Video, Art Personal care services Health and Well-Being Professional Services Restaurant Retail / apparel / accessories Trucking / transport

Automotive

Beauty Salons

Childcare/education

Cleaning Services

Delivery Service

Fitness and Recreational Sports Centers

Food retailers and Grocery/Convenience stores

Household / supplies / repair

Landscaping

Manufacturing

Music, Photography, Video, Art

Personal care services

Health and Well-Being

Professional Services

Restaurant

Retail / apparel / accessories

Trucking / transport

Key Differences U.S. International Savings Match Use of Peer Lending Concentration of Borrowers Interest Rates Technical Assistance

Opportunity Fund - Founded 1995 Opportunity Fund advances the economic well-being of working people by helping them earn , save , and invest in their future.

Opportunity Fund advances the economic well-being of working people by helping them earn , save , and invest in their future.

Microfinance Small Business Loans $1,000-200,000 One-to-one business and personal finance advising Largest Lender in Northern California Matched Savings Accounts 401-k like savings accounts with financial education and 2:1 match Top 2 IDA Providers in the nation (EARN)

Small Business Loans

$1,000-200,000

One-to-one business and personal finance advising

Largest Lender in Northern California

Matched Savings Accounts

401-k like savings accounts with financial education and 2:1 match

Top 2 IDA Providers in the nation (EARN)

Our Portfolio Loans $10 Million cumulative over last 10 years 800 loans 156 FY08 184 FY07 Size of outstanding portfolio: $2M Median loan size: $5,000 Historical Charge-Off Rate: 9% Savings 2,500 accounts cumulative over last 10 years On average, people saving $85/month Total raised by clients and matched funds: $9.8M Invested in Assets: 7.26M (Home, Small Business, Education, Retirement)

Loans

$10 Million cumulative over last 10 years

800 loans

156 FY08

184 FY07

Size of outstanding portfolio: $2M

Median loan size: $5,000

Historical Charge-Off Rate: 9%

Savings

2,500 accounts cumulative over last 10 years

On average, people saving $85/month

Total raised by clients and matched funds: $9.8M

Invested in Assets: 7.26M

(Home, Small Business, Education, Retirement)

Microloan Program Financial Information Earned Income: $500,000 (includes government contract) Direct Program Expenses: $1 million Cost Recovery: 50% (35% if include full administrative allocation) Cost Per Participant: $1,091 Operational Cost Rate (Operating Budget / Portfolio Under Management): 61% The Difference: Corporate Grants, Foundation Grants, Individual Donors

Earned Income: $500,000 (includes government contract)

Direct Program Expenses: $1 million

Cost Recovery: 50% (35% if include full administrative allocation)

Cost Per Participant: $1,091

Operational Cost Rate (Operating Budget / Portfolio Under Management): 61%

The Difference: Corporate Grants, Foundation Grants, Individual Donors

Our Clients 73% of clients are minorities, 70% are women

73% of clients are minorities, 70% are women

Our Impact Borrowers have an 85% survival rate (compared to ~44% national average) 30% Increase in household income 34% Increase in net business income 50% Increase in the number of employees per business Source: Each year, we use MicroTest, a performance and outcome management tool developed by FIELD, a project of the Aspen Institute. In 2007, our response rate was 60%. The following were among our findings.

Borrowers have an 85% survival rate (compared to ~44% national average)

30% Increase in household income

34% Increase in net business income

50% Increase in the number of employees per business

Source: Each year, we use MicroTest, a performance and outcome management tool developed by FIELD, a project of the Aspen Institute. In 2007, our response rate was 60%. The following were among our findings.

Contact Us www.opportunityfund.org Evelyn Huang Small Business Loan Program Director (408) 516-4602 [email_address] Eric Weaver CEO [email_address] May 28, 2009 Stanford University www.microfinancecalifornia.org The first state-wide conference highlighting microfinance as a smart investment for California

www.opportunityfund.org

Evelyn Huang

Small Business Loan Program Director

(408) 516-4602

[email_address]

Eric Weaver

CEO

[email_address]