Grameen Foundation : Resource Center : Print Newsletter : Fall 2003 : The PLAN Fund:Achieving Independence
The PLAN Fund:Achieving Independence Through Local Partnerships
The PLAN Fund of Dallas, Texas, a microfinance institution (MFI) currently implemented directly by GFUSA, is in the final stages of completing a three-year incubation period and becoming an independent non-profit. Read below to see how the PLAN Fund is leveraging local partnerships to secure the resources needed to reach growing numbers of low-income Dallas families.
Sandra McClain, thrift store owner and PLAN Fund client. The PLAN Fund was established in 1999 by Grameen Foundation USA and Dallas City Homes, a local non-profit organization, to provide small amounts of credit and other financial services to enable low-income individuals to start or expand "micro-businesses." Under the capable leadership of Alberto Muņoz since August 2002, the PLAN Fund has accelerated its growth and received increasing attention from philanthropists, local banks, community leaders and the media. The Dallas Morning News recently highlighted its impact on low-income, and predominantly African-American and Hispanic communities in the Dallas metropolitan area, noting that its results "in Dallas, as elsewhere, have been superb."
Looking to the future, the PLAN Fund has set ambitious goals for the next four years: providing 2,500 low-income individuals with a total of $5.5 million in loans, with the majority of these loans going to women. During this time, the PLAN Fund aims to reach 51% organizational self-sufficiency from interest and fees paid by borrowers. In order to make this vision a reality, new resources will be required initially for both loan capital and operational support.
After an introduction made by Dallas businesswoman and GFUSA Development Committee member Lucy Billingsley, the PLAN Fund secured the assistance of Elaine Agather, Chairman and CEO of JPMorgan Chase in Dallas, to put together a consortium of local banks to provide a substantial portion of the funding required for the first two years of the expansion effort. She succeeded in recruiting a number of new banks, beyond the two (Bank of Texas and Chase) that had supported the PLAN Fund previously.
Her approach was simple and effective. In July 2003 she hosted a meeting of prominent Dallas bankers and presented them with the opportunity to invest in the PLAN Fund's expansion. Ms. Agather emphasized the crucial role the banks could play in making the plan a reality and strengthening the financial future of low-income families in the area.
With the goal of raising $250,000 for the first two years of the expansion, the campaign is off to an excellent start. Leading by example, JPMorgan Chase contributed $25,000 to supplement its earlier loans and grants to the PLAN Fund. Others are following suit and, as of September 2003, Wells Fargo and Guaranty had made financial commitments.
By recruiting local financial institutions as partners in its effort to reduce poverty in Dallas, the PLAN Fund is demonstrating that diverse members of the financial sector-from those that provide microloans often starting at just $750 to those that routinely handle multimillion dollar transactions- can work together to build a vibrant local economy. As Paula Sullivan, Vice President of JPMorgan Chase's Community Development Group, recently said, "The firm's role is to connect our resources to non-profit and community organizations that we are working with to transform neighborhoods and create opportunity for underserved markets. JPMorgan Chase is proud of its relationship with the PLAN Fund, which is a vital component that strengthens the communities where we do business."
Grameen Foundation : Resource Center : Print Newsletter : Fall 2003 : The PLAN Fund:Achieving Independence
Grameen Foundation uses microfinance and innovative technology to fight global poverty and bring opportunities to the world's poorest people. With tiny loans and financial services, we help the poor, mostly women, start businesses and escape poverty. Our global network of 55 microfinance institution (MFI) partners including our Growth Guarantee partners has touched more than 34 million people in 24 countries. In addition, we introduced and now sustain technology initiatives (Mifos and Village Phone) in Cameroon, Kenya, Rwanda, and Uganda, bringing our total country outreach to 28.
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