OPIC partners pay back: The Eye Fund
(Part 3 in an ongoing series)
In 2010, OPIC committed a $5 million loan to the Eye Fund I, a socially-focused nonprofit investment fund committed to reducing blindness around the world by providing financing for the hospitals and clinics that serve the poor. World Health Organization data shows that more than 90 percent of the world’s blind live in the poorest parts of the developing world and the majority of blindness is curable and preventable through techniques such as cataract surgery.
While the Eye Fund has since then helped support almost 50,000 sight saving surgeries, it recently marked a different kind of milestone, joining the long list of OPIC-supported projects that have repaid their loans in full. The loan repayment underscores not only the strength of OPIC’s partners but also the fact that socially-focused investments can also be financially sound.
Managed by Deutsche Bank, the Eye Fund is a $14.48 million senior debt fund that was launched in 2010 through a partnership between Deutsche Bank, the International Agency for the Prevention of Blindness (IAPB) and Ashoka, a worldwide network of social entrepreneurs, with the goal of reducing blindness by fostering the growth of sustainable eye hospitals that serve the poor.
In a sector that had previously been financed largely through donations, the Eye Fund made loans to help finance the expansion of eye hospitals in developing countries, expand outreach programs, and train practitioners.
“OPIC’s loan was critical to making Eye Fund I a reality,” said Gary Hattem, managing director, Deutsche Bank Social Finance. “In 2015 alone, the Eye Fund I borrowers treated 477,000 patients and performed 49,000 sight saving surgeries, 55 percent of which were either free or heavily subsidized services for low-income patients that couldn’t afford treatment at market rates.”
Hattem noted that while many of the hospital borrowers faced significant challenges, the affordable eye care model “proved to be durable and adaptive, ensuring the hospitals successfully served the poor at scale and repaid their financial obligations on time.”
In fiscal year 2015, 35 OPIC partners repaid a total of $656.2 million in loans and financing – a reflection of the strength of OPIC’s development finance model. By providing loans when private financing is not available, OPIC helps businesses make a positive impact in emerging markets. By carefully screening loan applications and requiring that projects show strong business plans as well as a strong projected impact, OPIC is able to maintain a very low default rate and operate on a self-sustaining basis. Last year was the 38th consecutive year that OPIC generated money for deficit reduction.