Lok Capital I was launched in 2006 with USD 22 million and typically invests between USD 500,000 and USD 3 million in each investee.

About Lok Capital
Lok Capital LLC is a limited-life, limited-liability company based in India that provides equity and equity-linked investments to microfinance institutions (MFIs) in India. It consists of venture capital funds Lok I and Lok II and the Lok Foundation. Lok I was launched in 2006 with USD 22 million. Its investors include ACCION International, The Commonwealth Development Corporation (CDC), Developement International Desjardins, Netherlands Development Company (FMO in Dutch), International Finance Corporation (IFC), Kreditanstalt für Wiederaufbau (KfW) and responsAbility. Under Lok I, the fund’s investments generally range from USD 500,000 to USD 3 million. Lok II was closed in 2012 with USD 65 million. Investors included previous investors IFC, CDC, KfW, FMO and responsAbility along with new investors Proparco and ASN Novib. Under Lok II, the fund’s investments range from USD 2 million to USD 4 million. The Lok Foundation provides technical assistance to Indian MFIs.

About Lok II
Lok II is a venture capital fund managed by Lok Capital LLC, a microfinance investment firm based in India that invests primarily in Indian microfinance institutions (MFIs). It was founded in 2010 and is sponsored by the Lok Foundation, a non-profit corporation based in New York that provides technical assistance to MFIs. Lok II was closed in 2012 with USD 65 million. The International Finance Corporation (IFC), the investment arm of the World Bank, has committed USD 15 million in equity to the fund. The fund’s other investors are UK-based development finance institution Commonwealth Development Corporation, state-owned German development bank Kreditanstalkt fur Wiederaufbau (KfW), Swiss investment company responsAbility, Netherlands-based development bank Nederlandse Financierings-Maatschappijvoor Ontwikkelingslanden NV (FMO), French development finance institution Proparco and Dutch microfinance investment vehicle ASN Novib. The amounts of these firms’ investments in Lok II have not been disclosed.

By Charlotte Newman, Research Associate

Sources and Additional Resources:

Financial Chronicle: “Lok Capital Raises $65m to Back Social Ventures,” http://www.mydigitalfc.com/companies/lok-capital-raises-65m-back-social-ventures-069

MicroCapital.org story, November 25, 2010, “MICROCAPITAL BRIEF: Lok Capital Announces $52m Close for Indian Microfinance Fund, Lok II,” http://www.microcapital.org/microcapital-brief-lok-capital-announces-52m-close-for-indian-microfinance-fund-lok-ii/

MicroCapital.org story, May 6, 2010, “MICROCAPITAL BRIEF: International Finance Corporation (IFC) Provides $15m Equity Investment to Lok II, an $80m Microfinance Fund that Will Invest in Microfinance Institutions (MFIs) in India,” http://www.microcapital.org/microcapital-brief-international-finance-corporation-ifc-provides-15m-equity-investment-to-lok-ii-an-80m-microfinance-fund-that-will-invest-in-microfinance-institutions-mfis-in-india/

MicroCapital Universe Profile: Lok Capital http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Lok+Capital+LLC#Description_140_word_limit_

MicroCapital Universe Profile: Lok II
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Lok+II#Description_140_word_limit_

MicroCapital Universe Profile: International Finance Corporation
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=International+Finance+Corporation+%28IFC%29

MicroCapital Universe Profile: Commonwealth Development Corporation
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=CDC+Group

MicroCapital Universe Profile: Kreditandstalkt fur Wiederaufbau
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=KfW+Entwicklungsbank+%28KfW%29

MicroCapital Universe Profile: responsAbility
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=responsAbility

MicroCapital Universe Profile: Nederlandse Financierings-Maatschappijvoor Ontwikkelingslanden NV
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Nederlandse+Financierings-Maatschappijvoor+Ontwikkelingslanden+N.V.+%28Netherlands+Development+Finance+Company%2C+FMO%29

MicroCapital Universe Profile: Proparco
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=PROPARCO

MicroCapital Universe Profile: ASN Novib
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=ASN-Novib+Fund

Browse the MicroCapital Universe and add your entry to the wiki at http://www.microcapital.org/microfinanceuniverse/

This paper reviews the roles of development finance institutions (DFIs) and private lenders in funding microfinance institutions (MFIs). While DFIs are expected to pave the way for private funders to support MFIs as the industry matures, “Role Reversal,” a 2007 report published by MicroRate indicates that this is not the case. The 2007 paper observed that DFI lending was heavily concentrated towards the most creditworthy MFIs, leaving investment in smaller or riskier MFIs to private microfinance funds. This new report re-examines the situation and finds that MFIs with easy access to private funding still make up a significant portion of DFI lending.

“A Business Case for Microinsurance: An Analysis of the Profitability Of Microinsurance for Five Insurance Companies,” Janice Angove and Nashelo Tande, published by the Microinsurance Innovation Facility, July 2011, 55 pages, available athttp://www.ilo.org/public/english/employment/mifacility/download/mp11bus…

This paper analyses the profitability of microinsurance through case studies of five insurers that operate in low-income markets in Kenya, South Africa, India, Guatemala and the Philippines. The authors utilize a framework based on three main drivers of profitability: generating sufficient income by reaching scale, managing claims costs and managing acquisition and administration costs. The findings indicate that products with simple life benefits can be profitable. Working with partners can also be beneficial for insurers, both in managing distribution and administration costs as well as in providing customers value beyond the cover provided by the insurance policies.

“Trends in Cross-Border Funding,” by Barbara Gähwiler and Alice Nègre, published by CGAP (Consultative Group to Assist the Poor), December 2011, 4 pages, available athttp://www.cgap.org/gm/document-1.9.55998/Brief_Cross-BorderFunding.pdf

This paper describes global trends in microfinance funding between 2007 and 2010 based on data from the annual CGAP Funder Survey of cross-border funders. The findings show that the amount of new commitments increased from USD 2.9 billion in 2009 to USD 3.6 billion in 2010. The study also shows the increased use of microfinance investment vehicles (MIVs) and other intermediaries in channelling investments. While debt remains the primary instrument used by funders, equity investments have increased, with the share of equity funding in total commitments at 13 percent in 2010, up from 9 percent in 2008.

By Kristha Abores, Reseach Associate

Sources and Additional Resources:

[1] “Role Reversal Revisited,” http://microrate.com/wp-content/uploads/2012/01/Role-Reversal-Revisited-…

[2] “A Business Case For Microinsurance: An Analysis Of The Profitability Of Microinsurance For Five Insurance Companies,”http://www.ilo.org/public/english/employment/mifacility/download/mp11bus…

[3] “Trends in Cross-Border Funding,” http://www.cgap.org/gm/document-1.9.55998/Brief_Cross-BorderFunding.pdf

“Cross-border Funding (2011),” http://www.cgap.org/p/site/c/template.rc/1.11.45737/1.26.17576/

“CGAP Cross?border Funder Survey 2011,” http://www.cgap.org/gm/document-1.9.55343/Funder_Survey_2011_Results_Table_Rev.pdf

Browse the MicroCapital Universe and add your entry to the wiki at: http://www.microcapital.org/microfinanceuniverse/

While existing investors including Lok Capital, India Financial Inclusion Fund, Sequoia Capital, Mauritius Unitus Corporation and Elevar Equity have participated in this round of funding, the majority of the new funds came from two institutions that are investing in Ujjivan for the first time: INR 326 million (USD 6.37 million) from the Netherlands Development Finance Company (FMO in Dutch) and INR 400 million (USD 7.82 million) from Wolfensohn Capital Partners (WCP) Mauritius Holdings III. FMO, a public-private development bank, supports financial institutions and countries through “loans, participations, guarantees and other investment promotion activities.” WCP Maurituis Holdings III is an affiliate of Wolfensohn Capital Partners, a US-based private investment fund that specializes in growth equity investments in emerging markets.

Sanjiv Kapur, managing director of Wolfensohn India Advisors, said, “This is the first investment for Wolfensohn in the Indian microfinance sector, endorsing our faith in the sector and in Ujjivan’s financial inclusion model.”

Mohit Bhatnagar, managing director of Sequoia Capital, Ujjivan’s largest stakeholder, said, “India continues to be a preferred investment destination for [foreign institutional investors,] and it is heartening to see that fundamentally strong organisations in the microfinance sector are a key focus.”

As of September 30, 2011, Ujjivan reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 129 million, a gross loan portfolio of USD 121 million, return on assets (ROA) of -1.86 percent and 744,000 active borrowers.

By Kristha Abores, Research Associate

About Ujjivan Financial Services:

Ujjivan Financial Services is a microfinance institution (MFI) based in Bangalore, India, that offers loans and insurance products. It was founded in 2004 and focuses on low-income women in urban and semi-urban areas. Its products include business loans, educational loans, emergency loans and life insurance. As of September 30, 2011, Ujjivan reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 129 million, a gross loan portfolio of USD 121 million, return on assets (ROA) of -1.86 percent and 744,000 active borrowers.

About Nederlandse Financierings-Maatschappijvoor Ontwikkelingslanden N.V. (Netherlands Development Finance Company, FMO):

The Netherlands Development Finance Company (FMO in Dutch) is a public-private development bank which supports financial institutions and countries through “loans, participations, guarantees and other investment promotion activities.” It was founded in 1970 by the “Dutch government, private sector, employers and employee organizations.” It has access to government funds and therefore can take higher risks with its investments including long-term finance. It also specializes in local-currency finance. In 2010, FMO distributed approximately EUR 2.5 million (USD 3.3 million) in loans.

About Wolfensohn Capital Partners:

Wolfensohn Capital Partners is a New York-based private investment fund that specializes in growth equity investments in emerging markets. Founded in 2005 by James D Wolfensohn, who served as president of the World Bank from 1995 to 2005, it seeks to provide financial returns to its clients while supporting sustainability and poverty alleviation. Financial information on the organization is not available.

Sources and Additional Resources:

[1] “Ujjivan raises Rs.127.9 Crores (USD 25.5 Mn.) equity ,” http://www.ujjivan.com/news_ujjivan_raises_127_crores_equity.htm

MicroCapital.org article, September 16, 2011, “MICROCAPITAL BRIEF: Indian Microfinance Institution (MFI) Ujjivan Looking to Raise $138m from Private, Public Sector Banks,” http://www.microcapital.org/microcapital-brief-indian-microfinance-institution-mfi-ujjivan-looking-to-raise-138m-from-private-public-sector-banks/

MicroCapital.org article, January 10, 2011, “MICROCAPITAL BRIEF: Ujjivan Financial Services Raises $8.8m of Debt Capital Through Non-Convertible Debenture (NCD) Issuance to Developing World Market’s Member Company DWM (Cyprus) Limited,” http://www.microcapital.org/microcapital-brief-ujjivan-financial-service…

MicroCapital Universe Profile: Ujjivan Financial Services, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Ujj…

MicroCapital Universe Profile: Nederlandse Financierings-Maatschappijvoor Ontwikkelingslanden N.V. (Netherlands Development Finance Company, FMO), http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Nederlandse+Financierings-Maatschappijvoor+Ontwikkelingslanden+N.V.+%28Netherlands+Development+Finance+Company%2C+FMO%29…

MicroCapital Universe Profile: Wolfensohn Capital Partners (WCP), http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Wolfensohn+Capital+Partners

MicroCapital Universe Profile: Lok Capital LLC, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Lok+Capital+LLC…

MicroCapital Universe Profile: The India Financial Inclusion Fund (IFIF), http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=India+Financial+Inclusion+Fund+%28IFIF%29…

MicroCapital Universe Profile: Sequoia Capital, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Seq…

MicroCapital Universe Profile: Unitus Equity Fund I, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Uni…

MicroCapital Universe Profile: Elevar Equity Advisors, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Ele…

MicroCapital Universe Profile: Reserve Bank of India, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Reserve+Bank+of+India+%28RBI%29…

Browse the MicroCapital Universe and add your entry to the wiki at: http://www.microcapital.org/microfinanceuniverse/

Mr Jack Lowe co-founded Azure Partners with Mr Vincent Oswald, both of whom were formerly with Geneva-based microfinance investment company Blue Orchard. Mr Lowe argues that “Microfinance has three distinct advantages for the investor: negative correlation with most other asset classes, extremely low volatility and enormous geographic diversification in emerging markets…. This combination of factors has provided historic returns of 4-8 per cent for debt funds and 12-18 per cent for private equity funds. The sector has never experienced a negative yearly performance.”

As of January 2012, the Azure Global Microfinance Fund has made three investments and reports a “pipeline of 10 investable funds” [2]. The amount of funds raised by Azure Global Microfinance Fund has not been made public. The fund received the LuxFLAG Microfinance Label from Luxembourg Fund Labeling Agency (LuxFLAG), an organization that investigates whether investment vehicles actually support the microfinance sector. Company wide, Azure Partners has invested in 74 microfinance funds, 36 fund managers, 10 microfinance networks and 10 development banks as of 2011.

By Nisha Koul, Research Associate

About Azure Partners: Azure Partners is a Swiss company specializing in socially responsible investments. It focuses mainly on microfinance and acts as investment advisor to the Azure Global Microfinance Fund. As of January 2012, the Azure Global Microfinance Fund has made three investments and reports a “pipeline of 10 investable funds.” Company wide, Azure Partners has invested in 74 microfinance funds, 36 fund managers, 10 microfinance networks and 10 development banks as of 2011.

Sources and Additional Resources:

[1] Financial Times, “Microfinance men launch fund of funds,” http://www.ft.com/intl/cms/s/0/cf573ec0-42c3-11e1-93ea-00144feab49a.html#axzz1kUrKPJZS

[2] Azure Partners, “Azure Global Microfinance Fund,” http://www.azure-partners.com/docs/Azure_partners.pdf

MicroCapital.org story, January 18, 2012, “MICROCAPITAL BRIEF: FINCA International Launches For-Profit Subsidiary: FINCA Microfinance Holdings LLC,” http://www.microcapital.org/microcapital-brief-finca-international-launches-for-profit-subsidiary-finca-microfinance-holdings-llc/

MicroCapital.org story, January 10, 2012, “MICROCAPITAL BRIEF: Private Equity Investors Wary As Return on Equity for Indian Microfinance Institutions Drops from Over 45% to Under 20%,” http://www.microcapital.org/microcapital-brief-private-equity-investors-wary-as-return-on-equity-for-indian-microfinance-institutions-drops-from-over-45-to-under-20/

MicroCapital Universe Profile: Azure Partners, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Azure+Partners

Browse the MicroCapital Universe and add your entry to the wiki at http://www.microcapital.org/microfinanceuniverse/

The target size of SEIIF, which will invest in debt and equity instruments, is USD 100 million after three years. The fund aims to create 100,000 jobs in five years.

By Nisha Koul, Research Associate

About Oxfam International: Oxfam International was established in 1995 as a confederation of 15 organizations working to reduce poverty. Oxfam’s name is derived from its founding member, the Oxford Committee for Famine Relief, which began operating in Britain in 1942 by advocating for food supplies to be sent to women and children in Greece during the Second World War. Oxfam International since has grown into a network of member organizations serving 99 countries with disaster relief, advocacy and policy research with the aim of providing long-term solutions for poverty eradication. As of March 2011, Oxfam International reports GBP 2.8 million (USD 4.4 million) in assets.

About Symbiotics: Founded in 2005, Symbiotics provides for-profit investment intermediary services to the microfinance industry as well as business services to investors and practitioners of micro- and small enterprise (MSE) development. Symbiotics works with approximately twenty investment funds (MIVs) and a dozen institutional investors. It has facilitated the provision of USD 895 million in capital to about half a million micro-, small and medium-sized enterprises (MSMEs) through 150 financial institutions in approximately 35 emerging economies. The company also offers Syminvest, a microfinance investment intelligence platform designed to increase transparency and enhance investment capacity in the industry by monitoring regional markets and specific institutions.

Sources and Additional Resources:

[1] Symbiotics News, “SEIIF – Oxfam and Symbiotics target investment industry with new SME fund,” http://www.symbioticsgroup.com/news/latest-news/seiif-oxfam-and-symbiotics-target-investment-industry-with-new-sme-fund

MicroCapital.org story, December 28, 2010, “MICROCAPITAL BRIEF: Symbiotics Launches Micro-, Small & Medium-Sized Enterprise Bonds Electronic Platform, Closes Two Deals for Mutual Cartago de Ahorro y Prestamo (MUCAP) and Microfinance Institution (MFI) Lanka ORIX MicroCredit (LOMC),” http://www.microcapital.org/microcapital-brief-symbiotics-launches-micro-small-medium-sized-enterprise-bonds-electronic-platform-closes-two-deals-for-mutual-cartago-de-ahorro-y-prestamo-mucap-and-microfinance-institu/

MicroCapital.org story, November 1, 2010, “MICROCAPITAL BRIEF: CARE, Barclay’s, Oxfam, EcoBank, Others Collaborate to Expand Financial Services to Sub-Saharan Africa’s Poor,” http://www.microcapital.org/microcapital-brief-care-barclays-oxfam-ecobank-others-collaborate-to-expand-financial-services-to-sub-saharan-africas-poor/

MicroCapital Universe Profile: Oxfam International, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Oxfam+International

MicroCapital Universe Profile: Symbiotics, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Symbiotics+Group

Browse the MicroCapital Universe and add your entry to the wiki at http://www.microcapital.org/microfinanceuniverse/

The funding from AFD will go to a TA facility that has been built in parallel with the Incofin Rural Impulse Fund II with the intent of improving operational, financial, strategic and organizational aspects of investee microfinance institutions. AFD, through the grant, looks to support microfinance institutions in “Priority Solidarity Zones” identified by the French government, which are Southeast Asia; the Mediterranean Region; and the African, Caribbean and Pacific Group of States (ACP). The TA interventions funded by AFD will be implemented between 2012 and 2014 [1].

In 2010, AFD reportedly invested approximately EUR 6.8 billion (USD 9.6 billion) in the Southern Hemisphere providing primary schooling for 13.4 million children, improving drinking water supplies for 33 million people and disbursing microloans to 700,000 people.

By Natalie Baer, Research Associate

About the Incofin Rural Impulse Funds (RIF): The Incofin Rural Impulse Funds (RIF) were launched by Incofin Investment Management to invest in rural microfinance institutions (MFIs) that are deemed commercially viable. The two funds include Rural Impulse Fund I and Rural Impulse Fund II. They target both farm and non-farm populations in small towns and villages. The funds invest primarily through loans, though they make equity investments and guarantees as well. As of October 31, 2011, Rural Impulse Fund I has outstanding investments of EUR 25.7 million (USD 35.9 million) and a fund size of EUR 30 million (USD 38 million), while Rural Impulse Fund II has outstanding investments of EUR 33.1 million (USD 46.0 million) and a fund size of EUR 120 million (USD 173 million).

About Incofin Investment Management (Incofin IM): Incofin Investment Management is a private Belgian company that develops and manages funds investing in microfinance institutions (MFIs) in developing countries. As of June 2011, Incofin manages six facilities with total outstanding investments of USD 425 million in 39 countries.

About Agence Française de Développement (AFD): Established in 1941, Agence Française de Développement (AFD) is a bilateral development finance institution whose public mandate is to finance development according to the overseas development assistance policies of the French government. In 2011, AFD reportedly committed approximately EUR 7 billion (USD 9.2 billion) to financing aid activities in developing and emerging countries and the French Overseas Communities. These investments involved providing primary schooling for 13.4 million children, improving drinking water supplies for 33 million people and disbursing microloans to 700,000 people.

Sources and Resources:

[1]  Incofin Press Release, “AFD grants 1.8 million EUR to TA facility of Incofin IM’s Rural Impulse Fund II.”
MicroCapital Universe Profile: Incofin Rural Impulse Funds (RIFs I and II), http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Incofin+Rural+Impulse+Funds+%28RIFs%29

MicroCapital Universe Profile: Incofin Investment Management, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Incofin+Investment+Management+%28Incofin+IM%29

MicroCapital Universe Profile: Agence Francaise de Developpement (AFD), http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Agence+Francaise+de+Developpement+%28AFD%29

Browse the MicroCapital Universe and add your entry to the wiki at: http://www.microcapital.org/microfinanceuniverse/

The LuxFLAG Microfinance Label is granted to MIVs in an effort to “reassure investors that the MIV actually invests, directly or indirectly, in the microfinance sector.” The role of the eligibility committee is to examine applications for the label and recommend to the Board of Directors of LuxFLAG whether or not the label should be awarded to the applicant.

By Nisha Koul, Research Associate

About MicroRate: MicroRate is a microfinance rating agency formally approved by CGAP (Consultative Group to Assist the Poor); the Inter-American Development Bank; and Peru’s Superintendency of Banking, Insurance and Pension Fund Managers (SBS). It was founded in the US in 1997 with the intent of objectively evaluating microfinance institutions (MFIs), thereby increasing transparency and driving additional funding into microfinance. MicroRate has completed approximately 600 ratings of approximately 200 MFIs worldwide as of 2012 and claims to perform its evaluations not through “rigid rating formulas,” but through the “evaluation of critical risk.” A private company, MicroRate is based in Washington, DC, with offices in Peru and Morocco.

About Luxembourg Fund Labeling Agency (LuxFLAG): Established in 2006, the Luxembourg Fund Labeling Agency (LuxFLAG) aims to “promote the raising of capital for Microfinance and Environment related sectors by awarding a recognizable label to eligible microfinance investment vehicles (MIVs) and environment-related investment vehicles (EIVs).” Its objective is to reassure investors that the MIV or EIV actually invests, directly or indirectly, in the microfinance or environment sector. LuxFLAG only certifies MIVs and EIVs that are either subject to European Union member state supervision or located in nations with financial supervision on par with countries in the European Union. As of 2011, 20 MIVs and three EIVs hold current LuxFLAG labels.

Sources and Additional Resources:

[1] Press release submitted to MicroCapital, January 2012.

[2] Email conversation between MicroCapital and LuxFLAG representatives.

MicroCapital.org story, January 13, 2012, “MICROCAPITAL BRIEF: MicroRate, LuxFlag Launch Luminis Looking to Increase Transparency of Microfinance Funds,” http://www.microcapital.org/microcapital-brief-microrate-luxflag-launch-luminis-looking-to-increase-transparency-of-microfinance-funds/

MicroCapital.org story, October 10, 2011, “MICROCAPITAL BRIEF: LuxFLAG Grants Microfinance Label to Microfinance Enhancement Facility, Selectum, Etimos Fund, Dual Return Fund Vision Microfinance Local Currency; Renews Label for Six Other Microfinance Investment Vehicles (MIVs),” http://www.microcapital.org/microcapital-brief-luxflag-grants-microfinance-label-to-microfinance-enhancement-facility-selectum-etimos-fund-dual-return-fund-vision-microfinance-local-currency-renews-label-for-six-other-micro/

MicroCapital.org story, May 18, 2010, “MICROCAPITAL BRIEF: LuxFLAG and MicroRate Announce LUMINIS Microfinance, Internet-Based Microfinance Investment Vehicle Information Service,” http://www.microcapital.org/microcapital-brief-luxflag-and-microrate-announce-luminis-microfinance-internet-based-microfinance-investment-vehicle-information-service/

MicroCapital Universe Profile: MicroRate,
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=MicroRate

MicroCapital Universe Profile: Luxembourg Fund Labeling Agency (LuxFLAG), http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=LuxFLAG

Browse the MicroCapital Universe and add your entry to the wiki at http://www.microcapital.org/microfinanceuniverse/

The first step in applying for an EIV label is to complete a pre-questionnaire to assess eligibility for the label followed by the application form that is available at: http://www.luxflag.org/documents/criteria_procedures/Application_form_Appendix_3.xls. The application deadline is February 20, 2012. For more information, you may contact LuxFLAG at info at luxflag.org or +352 22 30 261.

By Nisha Koul, Research Associate

About Luxembourg Fund Labeling Agency (LuxFLAG): Established in 2006, the Luxembourg Fund Labeling Agency (LuxFLAG) aims to “promote the raising of capital for Microfinance and Environment related sectors by awarding a recognizable label to eligible microfinance investment vehicles (MIVs) and environment-related investment vehicles (EIVs).” Its objective is to reassure investors that the MIV or EIV actually invests, directly or indirectly, in the microfinance/environment sector. LuxFLAG only certifies MIVs/ EIVs that are either subject to European Union member state supervision or located in nations with financial supervision on par with countries in the European Union. As of 2011, 20 MIVs and three EIVs hold current LuxFLAG labels.

Sources and Additional Resources:

[1] Press release submitted to MicroCapital, January 2012.

[2] LuxFLAG Environment, “Criteria & Procedure,” http://www.luxflag.org/EIV_labelProcedure.htm

MicroCapital.org story, January 13, 2012, “MICROCAPITAL BRIEF: MicroRate, LuxFlag Launch Luminis Looking to Increase Transparency of Microfinance Funds,” http://www.microcapital.org/microcapital-brief-microrate-luxflag-launch-luminis-looking-to-increase-transparency-of-microfinance-funds/

MicroCapital.org story, October 10, 2011, “MICROCAPITAL BRIEF: LuxFLAG Grants Microfinance Label to Microfinance Enhancement Facility, Selectum, Etimos Fund, Dual Return Fund Vision Microfinance Local Currency; Renews Label for Six Other Microfinance Investment Vehicles (MIVs),” http://www.microcapital.org/microcapital-brief-luxflag-grants-microfinance-label-to-microfinance-enhancement-facility-selectum-etimos-fund-dual-return-fund-vision-microfinance-local-currency-renews-label-for-six-other-micro/

MicroCapital Universe Profile: Luxembourg Fund Labeling Agency (LuxFLAG), http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=LuxFLAG

Browse the MicroCapital Universe and add your entry to the wiki at http://www.microcapital.org/microfinanceuniverse/

FMH has raised the following commitments, which are to be accessed over a three-year period: USD 35 million from World Bank Group member International Finance Corporation (IFC), USD 15 million from German development bank KfW Bankengruppe, USD 14 million from Dutch development bank Nederlandse Financierings-Maatschappijvoor Ontwikkelingslanden NV (FMO) and USD 5 million each from Swiss microfinance investment vehicle responsAbility Global Microfinance Fund and Triple Jump, an investment manager and advisor [2].

In order to preserve control of the organization’s mission, FINCA International will retain 66 percent of the shares of FMH. The identities of any other owners have not been released. A Social Performance Audit Committee of the Board of FMN has been established to further ensure that the focus remains on FINCA clients rather than on maximizing profits. FINCA’s employees and board members will not be allowed to invest in FMH shares. In the 2010 fiscal year, FINCA International served approximately 760,000 clients through its subsidiaries in 21 countries [1] [2].

About FINCA International
Founded in 1984 by Dr John Hatch, a pioneer of the village banking model, the Foundation for International Community Assistance (FINCA) International is a microfinance network based in Washington, DC, that provides financial services to poor families through a network of locally managed institutions. FINCA targets its services to poor women living in the Americas, sub-Saharan Africa and Eurasia. In the 2010 fiscal year, FINCA International served approximately 760,000 clients through its subsidiaries in 21 countries. As of 2010, it had total assets of USD 496 million, with an operating profit of USD 10 million. In December of 2011, FINCA launched a subsidiary, FINCA Microfinance Holdings LLC, with funding from the International Finance Corporation (IFC), KfW Bankengruppe, Nederlandse Financierings-Maatschappijvoor Ontwikkelingslanden NV (FMO), responsAbility, and Triple Jump.

About IFC
A member of the World Bank Group, the International Finance Corporation (IFC) offers loans, equity investments, advisory services and technical assistance to private companies with the intent of alleviating poverty and promoting open and competitive markets in developing countries. As of 2011, IFC has 182 member countries and reports a net income of USD 1.58 billion, total assets of USD 68.5 billion, return on assets of 2.4 percent and total investment mobilization of USD 12.2 billion to 518 projects.

About KfW Bankengruppe
The KfW Bankengruppe (KfW Bank Group) is a German development bank whose objective is to support economic, social and ecological development worldwide. Owned by the Federal Republic and the Länder (federal states), it offers financial support in the areas of small and medium-sized enterprise, entrepreneurship, environmental protection, housing, infrastructure, education, finance, and development cooperation. In 2010 KfW Bankengruppe invested approximately USD 7.4 billion in the promotion for developing and transition countries.

About FMO
The Nederlandse Financierings-Maatschappijvoor Ontwikkelingslanden NV (FMO) is a public-private development bank that supports financial institutions and governments through “loans, participations, guarantees and other investment promotion activities.” It was founded in 1970 by the “Dutch government, private sector, employers and employee organizations.” It has access to government funds and therefore can take higher risks with their investments including long-term finance. It also specializes in local-currency finance. In 2010 FMO gave approximately USD 3.3 million in loans.

About rAGMF
The responsAbility Global Microfinance Fund (rAGMF) is a microfinance investment vehicle (MIV) managed by responsAbility Social Investments that invests in microfinance institutions (MFIs) and other MIVs, mostly through short- to medium-term debt securities. rAGMF also invests up to 10 percent of its assets in the equity of MFIs. In April 2011, its annual label was renewed by the Luxembourg Fund Labeling Agency (LuxFLAG), an organization that investigates whether investment vehicles actually support the microfinance sector. rAGMF reported to the US-based nonprofit Microfinance Information Exchange (MIX) fund assets of USD 532 million in 2011.

About Triple Jump
Triple Jump was founded in 2006 to support the expansion of microfinance institutions (MFIs) through the provision of capital and advisory services. Triple Jump was established by the NOTS Foundation, a Dutch development organization; Oxfam Novib, a Dutch organization for international cooperation and development; and ASN Bank, a “sustainability-driven” Dutch bank. Its shares are divided among these organizations and Triple Jump’s management team. Triple Jump is comprised of Triple Jump Fund Management (TJFM) and Triple Jump Advisory Services (TJAS). TJFM provides its clients with four investment options: hard and local currency loans, equity, guarantees and subordinated loans. TJAS is an independent foundation that provides consulting services and technical assistance to tier-3 and tier-4 MFIs. Triple Jump manages five microfinance investment funds, with total assets approximately equivalent to USD 300 million as of March 31, 2011. Its investments span 132 MFIs in 52 emerging markets in Latin America, Eastern Europe, Africa and Asia.

By Charlotte Newman, Research Associate

Sources and Additional Resources:

[1] FINCA: “FINCA International Launches Socially-Responsible Investment Subsidiary”
http://www.finca.org/site/apps/nlnet/content2.aspx?c=6fIGIXMFJnJ0H&b=6088937&ct=10881409

[2] FINCA: “FINCA International and Partners Activate Final Funding for New Socially-Responsible Investment Subsidiary” http://www.finca.org/site/apps/nlnet/content2.aspx?c=6fIGIXMFJnJ0H&b=6088937&ct=11588009

MicroCapital.org story, June 24, 2011, “FINCA International Announces Launch of FINCA Microfinance Holdings With Investments of $74m from IFC, KfW, FMO, responsibility, Triple Jump,”
http://www.microcapital.org/microcapital-brief-finca-international-announces-launch-of-finca-microfinance-holdings-with-investments-of-74m-from-ifc-kfw-fmo-responsability-triple-jump/

MicroCapital Universe Profile: FINCA International
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=FINCA+International

MicroCapital Universe Profile: IFC
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=International+Finance+Corporation+%28IFC%29

MicroCapital Universe Profile: KfW Bankengruppe
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=KfWBankengruppe+%28KfW+Bank+Group%29

MicroCapital Universe Profile: FMO
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Nederlandse+Financierings-Maatschappijvoor+Ontwikkelingslanden+N.V.+%28Netherlands+Development+Finance+Company%2C+FMO%29

MicroCapital Universe Profile: Triple Jump
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Triple+Jump

Browse the MicroCapital Universe and add your entry to the wiki at
http://www.microcapital.org/microfinanceuniverse/

Dr Arman Vardanyan, Dual Return Fund – Vision Microfinance Fund Manager, opines that “the general market outlook for 2012 is positive” and that a “favorable outlook for sustained economic growth in a number of emerging and frontier markets [will] stimulate the increased demand for microfinance loans.”

By Nisha Koul, Research Associate

About Dual Return Vision Microfinance Fund: The Dual Return Fund is a sub-fund of Vision Microfinance, both of which were created in 2006 by Absolute Portfolio Management GmbH, an Austrian investment company specializing in microfinance. In 2011, the fund provided investors with net returns of 2.51 percent for its retail EUR (P) share class, 3.23 percent for its institutional EUR (I) share class and total fund volume of EUR 85.8 million (USD 109 million) with loans issued to 65 microfinance institutions (MFIs) in 25 emerging markets. In April 2011, its annual label was renewed by the Luxembourg Fund Labeling Agency (LuxFLAG), an organization that investigates whether investment vehicles actually support the microfinance sector.

About Dual Return Fund – Vision Microfinance Local Currency: The Dual Return Fund – Vision Microfinance Local Currency is a sub-fund of Vision Microfinance, both of which were created in 2006 by Absolute Portfolio Management GmbH, an Austrian investment company specializing in microfinance. The Vision Microfinance Local Currency fund disburses local-currency loans directly to microfinance institutions (MFIs). As of 2011, the fund provided investors with net returns of 4.55 percent for its USD (I) share class, achieved a fund volume of USD 28.8 million and held loans outstanding to 29 MFIs in 18 emerging markets. In April 2011, its annual label was renewed by the Luxembourg Fund Labeling Agency (LuxFLAG), an organization that investigates whether investment vehicles actually support the microfinance sector.

Sources and Additional Resources:

[1] “Dual Return Fund – Vision Microfinance & Vision Microfinance Local Currency Factsheet December, 2011” submitted to MicroCapital.

MicroCapital.org story, December 2, 2011, “MICROCAPITAL BRIEF: Vision’s Dual Return Fund Loans $6.2m to Microfinance Institutions in Latin America, Africa, Central Asia,” http://www.microcapital.org/microcapital-brief-vision%E2%80%99s-dual-return-fund-loans-6-2m-to-microfinance-institutions-in-latin-america-africa-central-asia/

MicroCapital.org story, September 14, 2011, “MICROCAPITAL BRIEF: Dual Return Fund of Vision Microfinance Loans $1.5m to Microfinance Institutions in Colombia, Dominican Republic,” http://www.microcapital.org/microcapital-brief-dual-return-fund-of-vision-microfinance-loans-1-5m-to-microfinance-institutions-in-colombia-dominican-republic/

MicroCapital Universe Profile: Dual Return – Vision Microfinance Fund, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=DUAL+RETURN+VISION+MICROFINANCE+FUND

MicroCapital Universe Profile: Dual Return – Vision Microfinance Local Currency Fund,http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Dual+Return+-+Vision+Microfinance+Local+Currency+Fund

Browse the MicroCapital Universe and add your entry to the wiki at http://www.microcapital.org/microfinanceuniverse/