School of International Studies

Katalysis Bootstrap Fund

Katalysis is a microfinance organization working with 250,000 clients (mainly women) in Central America. In 2006, Katalysis moved its headquarters from downtown Stockton to the Global Center on the Stockton Campus. Students are working as interns in Stockton as well as with the Katalysis partners in Central America.

The Katalysis Bootstrap Fund is a non-profit microfinance organization that provides small loans (average $326) to low income women, men and youth in the four poorest countries of Central America: Nicaragua, Guatemala, Honduras, and El Salvador. Katalysis (Greek for catalyst) works through a distribution network of 19 independent microfinance institutions in the region that currently service more than 250,000 clients (70% women). The client repayment rate is over 97%.

Katalysis is pioneering a new concept in northern microfinance organization sustainability: it accepts investments as well as donations. Most northern non-profits depend on contributions and grants. Katalysis focuses on acquiring repayable loans to build its credit fund from individuals, foundations, corporations, health systems, and religious communities. Investments are made for three to five years at 0 to 3% annual interest (determined by the investor). Thus far over $6 million has been raised from these socially responsible investments and loaned to local microfinance institutions at comparable local rates. When the fund reaches $10 million, it will be sustainable.

All of the 19 affiliated Katalysis microfinance partner agencies employ industry best practices and are self-sufficient operations. They offer a range of financial products to their clients including business loans, health and life insurance, educational loans, savings mobilization, youth entrepreneurship loans, and remittance transfer.

Katalysis recently joined forces with the Global Center for Social Entrepreneurship and moved its headquarters to the University of the Pacific campus. Pacific is the only university in the U.S. that has a fully operational international microfinance organization located within the institution. Together, Katalysis and the Global Center are exploring the opportunity to provide microcredit to the immigrant community in the California San Joaquin Valley.