Category: Trends/Challenges

MEET THE BOSS: Interview with Robert Annibale, Global Director of Citi Microfinance (Part One of a Two Part Series)

Bob Annibale is Global Director of Citi Microfinance. He leads the bank’s commercial relationships with microfinance institutions, on a multi-business and product basis, providing financing and product partnerships to institutions that serve the poor and the unbanked.

He joined Citibank in 1982. After a first assignment in Greece, he held a number of senior treasury, risk and corporate positions at Citi in Athens, Bahrain, Kenya, London and New York.  Mr. Annibale completed his BA degrees in History and Political Science at Vassar College and his Masters Degree in African Studies (History) at the University of London, School of Oriental and African Studies.

Mr. Annibale served on the Board of Advisors for the United Nations High Level Commission on Legal Empowerment of the Poor. He represents Citi on the Board of the Microfinance Information Exchange, on the Council of Microfinance Equity Funds and with the Microfinance Network. He also serves on a number of other external boards and councils. Continue reading

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MICROCAPITAL.ORG STORY: Developments in the Past Year of Microfinance Regulation Coverage by Microcapital.org

     Microfinance regulation has provided rich fodder for reporting over the past twelve months of coverage by Microcapital.org.  Nearly twelve months ago, in November 2008, Microcapital.org reported on the World Economic Forum’s Inaugural Summit on the challenges posed by regulatory frameworks as policy makers grappled with the question of how to advance microfinance.  Since that time, there have been a number of international agencies as well as developed country governments involved in researching and collaborating on guidelines for the strengthening of microfinance regulation. On the other hand, there have also been doubts about the relevance of regulation to microfinance sector: Continue reading

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MICROCAPITAL.ORG STORY: Communications Company Telenor Pakistan Launch Mobile Banking Service with Tameer Microfinance Bank

Telenor Pakistan, a subsidiary of the Norwegian mobile communications company, Telenor, and Tameer Microfinance Bank, a microfinance bank that is partially owned by Telenor, have launched a mobile banking service called “easypaisa” [1,2,3,4]. With the service, customers will be able to manage their accounts via their mobile phone, as well as send and receive money and pay bills from various outlets [1]. Continue reading

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MICROFINANCE PAPER WRAP-UP: Turning Principles into Practice: A Nicaraguan MFI Commits to Consumer Protection, by the Microfinance Gateway

Written by the Microfinance Gateway, Published on the Microfinance Gateway in July 2009, available at: http://www.microfinancegateway.org/p/site/m/template.rc/1.26.10904/

This article covers the steps taken by Banex, a Nicaraguan microfinance institution (MFI), to ensure that the Client Protection Principles put together by ACCION’s Center for Financial Inclusion and the Consultive Group to Assist the Poor (CGAP) are put into practice [1,2,3,4]. The principles were formed following the initial public offering (IPO) of Compartmos, a Mexican MFI, led to speculation over whether MFIs are taking profits into consideration more than the best interest of their clients [5]. The Client Protection Principles are as follows: Continue reading

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MICROCAPITAL.ORG STORY: Remittance Duopoly: International Fund for Agricultural Development (IFAD), African Development Bank (AfDB) and Inter-American Dialogue (IAD) Hold Global Forum on Remittances Calling for More Competition in African Remittance Market

The Global Forum on Remittances 2009, organized by the United Nations’ International Fund for Agricultural Development (IFAD) and the African Development Bank (AfDB) in collaboration with the Inter-American Dialogue (IAD), is calling for the lifting of restrictions and costly fees imposed on the USD 40 billion sent as remittances to Africa each year [1]. The forum, a follow-up to similar forums held in 2005 and 2007, also addressed a proposal by G8 leaders in July 2009 to reduce costs of remittances by 50 percent over the next five years [2, 3]. Continue reading

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MICROCAPITAL.ORG STORY: Braking Securitizations – India’s Economic Times Reports That The Reserve Bank of India Proposes To Ask Originating Banks To Hold Loans On Their Balance Sheets For 6 Months To Stem ‘Reckless Securitizations’ And Suggests That Holding Periods Should Be Tailored For Banks Originating Microfinance Loans

A recent article in India’s Economic Times entitled ‘The Reserve Bank of India may ask banks to hold securitised debt for six months’ [1] by Gaurav Pai noted that the Reserve Bank of India (RBI) [2] may ask Indian banks to retain originated debt on their loan books for six to seven months before selling or securitising those loans to other market players. A securitisation is a financing technique under which loans originated by a bank are sold to another market participant, usually a special purpose vehicle (SPV) for an agreed price. The SPV funds the purchase of the portfolio of loans from the originating bank by issuing debt instruments to investors. These debt instruments are often known as ‘asset backed securities’ as they are typically backed or collateralised by the portfolio of loans. Continue reading

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MEET THE BOSS: Discussions on Successful Due Diligence When Evaluating Microfinance Investment Vehicles’ (MIV’s) Financial Viability: Interview with Christina Leijonhufvud, Managing Director, Social Sector Finance Group (SSF)/Investment Bank (IB) at JP Morgan (Part III of a Three Part Series)

Ms. Leijonhufvud is Managing Director of the Global Social Sector Finance Group at JPMorgan. The SSF unit leverages JP Morgan’s products and skills to help bring financial services to microfinance and social enterprises around the world.  The scope includes capital markets, structured products and principal investments.  The unit seeks to achieve a double bottom line of social benefit and financial returns. According to JP Morgan, potential demand for sustainable financial services is immense, at an estimated USD 300 billion. JPMorgan utilizes its global IB platform to raise capital to support poverty alleviation initiatives in developing economies

Ms. Leijonhufvud has led J.P. Morgan’s Social Sector Finance unit since its inception in late 2007. A double bottom line initiative that brings financial services and financing to microfinance institutions and other enterprises serving the base of the economic pyramid, Social Sector Finance also focuses on engaging the firm’s employees in these sectors. Outside J.P. Morgan, Ms. Leijonhufvud serves on the Advisory Board for the Center for Financial Inclusion, has been a consultant to Ashoka-Innovators for the Public in their social financial services venture, and has lectured widely on financial globalization and emerging markets risks. Ms. Leijonhufvud has held various risk management positions at J.P. Morgan, including as head of Country Risk Management & Advisory, Credit Portfolio Market Risk Management, Emerging Markets Market Risk Management, and Industry Concentrations. Prior to joining J.P. Morgan in 1996, Ms. Leijonhufvud worked at the World Bank as Country Officer, helping develop reform programs and borrowing strategies for the former Soviet Republics of Central Asia. In 1991, she served on the Economic Reform Committee for the Government of Kazakhstan. Ms. Leijonhufvud earned a M.Sc. degree in Economics from the London School of Economics, a M.A. degree in International Affairs from George Washington University, and a B.A. in Sociology from UCLA. Continue reading

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MEET THE BOSS: Discussions on Successful Due Diligence When Evaluating Microfinance Investment Vehicles’ (MIV’s) Financial Viability: Interview with Christina Leijonhufvud, Managing Director, Social Sector Finance Group (SSF)/Investment Bank (IB) at JP Morgan (Part II of a Three Part Series)

Ms. Leijonhufvud is Managing Director of the Global Social Sector Finance Group at JPMorgan. The SSF unit leverages JP Morgan’s products and skills to help bring financial services to microfinance and social enterprises around the world.  The scope includes capital markets, structured products and principal investments.  The unit seeks to achieve a double bottom line of social benefit and financial returns. According to JP Morgan, potential demand for sustainable financial services is immense, at an estimated USD 300 billion. JPMorgan utilizes its global IB platform to raise capital to support poverty alleviation initiatives in developing economies.

Ms. Leijonhufvud has led J.P. Morgan’s Social Sector Finance unit since its inception in late 2007. A double bottom line initiative that brings financial services and financing to microfinance institutions and other enterprises serving the base of the economic pyramid, Social Sector Finance also focuses on engaging the firm’s employees in these sectors. Outside J.P. Morgan, Ms. Leijonhufvud serves on the Advisory Board for the Center for Financial Inclusion, has been a consultant to Ashoka-Innovators for the Public in their social financial services venture, and has lectured widely on financial globalization and emerging markets risks. Ms. Leijonhufvud has held various risk management positions at J.P. Morgan, including as head of Country Risk Management & Advisory, Credit Portfolio Market Risk Management, Emerging Markets Market Risk Management, and Industry Concentrations. Prior to joining J.P. Morgan in 1996, Ms. Leijonhufvud worked at the World Bank as Country Officer, helping develop reform programs and borrowing strategies for the former Soviet Republics of Central Asia. In 1991, she served on the Economic Reform Committee for the Government of Kazakhstan. Ms. Leijonhufvud earned a M.Sc. degree in Economics from the London School of Economics, a M.A. degree in International Affairs from George Washington University, and a B.A. in Sociology from UCLA. Continue reading

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MICROCAPITAL.ORG STORY: Continuing Challenges To Expanding Microfinance In India – Criminal Activity And Danger Impede Microfinance Activities In India’s Naxal-Dominated Areas And Remote Tribal Groups In The Non-Cash Communities Of Jharkhand And Chhattisgarh Find Microcredit Unfamiliar

A recent report by Deepti Chaudhury on the Live Mint online financial news portal entitled ‘Crime, inaccessibility impede spread of microfinance activity’ [1] discusses the challenges faced by some MFIs that operate in certain regions in India including Bangalore, Uttar Pradesh and the remote areas in Jammu and Kashmir. The report talks about an interview with a potential microfinance client in Uttar Pradesh’s Bahraich town. The potential client has been unable to secure access to microcredit facilities despite being young and having the means to repay simply because he lives in an area where ‘even the MFIs don’t want to go because widespread poverty has made forming self-help groups difficult’. In addition, most people in the area work in a livelihood or sector that cannot be expanded. Continue reading

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MICROCAPITAL.ORG STORY: ‘Fidelity Plc’ of Nigeria to Offer Banking Service Including Check Clearing to ‘Support Microfinance Bank’

According to Marcel Mbamalu of the Guardian in Nigeria, Support Microfinance Bank, a microfinance institution in Nigeria, has entered a “strategic and clearing partnership” with Fidelity Bank Plc, a major universal bank (capable of banking and investment activities) in Nigeria [1,2,3]. Customers of Support Microfinance Bank will now be able to receive banking services, including the clearing of checks, from all 140 branches of Fidelity Bank Plc [1]. Continue reading

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MICROCAPITAL.ORG STORY: Finance Minister of Bangladesh Says Climate Change is Major Factor Impeding Economic Growth for Low-Income Citizens

At a conference on extreme poverty in Bangladesh, the Finance Minister of Bangladesh, Mr. Abul Maal Abdul Muhith, announced that “global climate change poses the greatest challenge today in our poverty mitigation efforts.” He added that microcredit is not the prime tool for poverty alleviation, but that it can “very well be an aid to mitigating poverty” [1, 2]. Continue reading

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MICROCAPITAL.ORG STORY: International Finance Corporation (IFC) Supports Transformation of Kyrgyz Republic’s Bai-Tushum From Microcredit to Microfinance Company With the Intention Becoming a Deposit-Taking Instituion

The International Finance Corporation (IFC), the investment arm of the World Bank, has aided Bai-Tushum and Partners of the Kyrgyz Republic in transforming from a microcredit to a microfinance company [1,2,3]. This transformation will allow Bai-Tushum to provide more services to its clients beyond just small loans [1]. Namely, Bai-Tushum and Partners has now applied for a deposit-taking license from the National Bank of the Kyrgyz Republic in order to offer “deposit, savings, and related services to the public” [1]. Microcapital reported on the early stages of this effort in August 2009 [4]. Continue reading

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MICROCAPITAL.ORG STORY: CEO Of Delhi-Based NGO Access Development Services Warns Of The Risks Of Commercialization And Government Intervention In Microfinance And Discusses The Need For ‘Microfinance-Plus’ Services Including Livelihood Planning

In a recent article in India’s Business Standard online paper entitled ‘There is a tension between scale and soul in microfinance’ [1], reporter Sreelatha Menon interviews the CEO of Access Development Services (ADS) [2], Mr Vipin Sharma, on microfinance and the forthcoming event organized by on ADS later this month on responsible and social finance. Delhi-based ADS is a non-profit company that was established in March 2006 with a focus on ‘incubating emerging MFIs’ and helping them ‘upscale their operations, enhance their portfolio and meet the growing demand among poor communities’. ADS also seeks to facilitate on-lending fund flows from financial institutions through the ACCESS Microfinance Alliance platform [3]. Continue reading

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MICROCAPITAL.ORG STORY: Banco Compartamos SA Applies for Banking License to Accept Deposits from Clients

Banco Compartamos SA, a publicly traded Mexican bank and the largest microfinance institution (MFI) in Latin America with USD 587.8 million in total assets, plans to apply for a license to expand its banking services [1, 2, 3]. The license will allow the bank to take deposits by offering savings accounts to clients. It will also allow third parties to use the deposits to issue credit to and take interest payments from some of Compartamos´ 1.2 million customers. Continue reading

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