Our first impact investment
The first Tomorrow investment has been launched - still modest in size, but with exactly the right content: €50,000 of the customer deposits go to fund the global microfinance fund KCD III. This sounds like a seal of approval, and not like the beginning of sustainable and mobile banking. In reality, however, behind this cryptic name lies a fund that has already helped thousands of people in the past to build an economic existence. The Tomorrow Community makes it possible for people living in poverty to improve their living conditions by their own efforts.
The Microfinance Fund finances several dozen institutions worldwide. The focus of the institutes is on South and Central America, Asia and Eastern Europe. Microcredit offers are aimed at people on low incomes who usually have no access to other financial services. As they are generally unable to offer any collateral, they don’t have the opportunity to build up an economic existence. Microcredits give these people the opportunity to borrow money at fair conditions. The selected institutions of the KCD Fund ensure that the microloans support local economic development, that the interest rates for microloans are fair and that over-indebtedness of the borrowers is avoided.
On average, the microloans amount to around €1,300 and are largely given to women. Often the institutes also offer further training to the borrowers, e.g. courses in bookkeeping, in order to manage the microenterprise more successfully. While such offers open up new perspectives for clients, they reduce the risk of credit default for microfinance institutions. Although the amount invested in the first step is still comparatively small, we are only just beginning: step by step we will invest together in further projects that will make tomorrow’s world a better place.