Social Issue

With a population of 1.3 million people, East Timor is a peaceful and democratic nation, and although poverty levels remain very high, progress has been made in improving the quality of life. The proportion of Timorese living in poverty decreased from 50% in 2007 to 42% in 2014. In 2017, the Human Capital Index for East Timor stood at 0.43, compared to the regional average of 0.61.

Our Response

Microloans are a powerful tool to promote small-scale productive activity and improve farmers’ productivity.

Kaebauk Investimentu No Finansas (KIF) was founded in 2002 by the NGO Tuba Rai Metin, with the support of Catholic Relief Services and Save the Children. It offers microloans and other services with the objectives of improving the quality of life of families and empowering women.

KIF was the first company in East Timor to become a non-bank that can raise deposits. In addition, it has the widest branch network among all the country’s financial institutions.

There are few financial entities that are willing to grant microloans in the country. There are only two that provide these services: the BNCTL state bank and the NGO Moris Rasik. KIF is considered the leader in this sector.

KIF offers loans to clients who mainly live in rural areas, with an average value of 1,200 dollars. The majority of its portfolio is dedicated to micro-loans for the maintenance of commercial activities, but they also offer loans to small businesses, to improve housing, and loans for studies. They work in conjunction with the IFC (which is part of the World Bank), developing loans for the agricultural sector, which is expected to represent 10% of its portfolio in two years.

Expected Social Impact

With this investment of the Netri Foundation, it is estimated that KIF will be able to provide 330 microloans with the idea of empowering the rural communities of East Timor.