MICROCAPITAL BRIEF: Goodwell Disburses Convertible Loan to “Innovative Microfinance Limited” for Expansion in Rural Ghana

Through its Goodwell Microfinance Development Company (MDC) III Fund, Goodwell Investments recently issued a convertible loan of undisclosed amount to Ghanaian microfinance institution (MFI) Innovative Microfinance Limited (IML), which provides credit, savings products, financial education, business development training and environmental advisory services to low-income individuals and microenterprises. IML is slated to use the funding to expand its network of three branches to include five additional service outlets in rural regions of northern Ghana.

As of 2016, IML serves approximately 7,000 borrowers and 10,000 depositors, of whom the majority are “market women” and other small business owners. Its founding shareholders are Sheila Azuntaba and Ghana-based African Tiger Holdings. Information on the percentage of equity held by each is unavailable, as is financial information on IML.

As a follow-on to Goodwell MDC III’s first close in 2014, Goodwell Investments is in the process of raising an additional EUR 20 million (USD 21.7 million) for the fund. It intends to invest half in small and medium-sized enterprises that provide “basic goods and services” and half in “financial inclusion” efforts in Sub-Saharan Africa. Goodwell Investments will disburse investments from Goodwell MDC III through “equity stocks, quasi-equity, preferred convertibles, preferred redeemable (if allowed under regulation), mezzanine loans, royalties and other private equity instruments” with an average holding period of five to seven years.

As of year-end 2015, Goodwell Investments supports 24 microfinance institutions and mobile payment companies in India and sub-Saharan Africa with EUR 70 million (USD 76 million) in committed capital.

By Michelle Dold, Research Associate

About Goodwell Investments

Based in the Netherlands, Goodwell Investments is a private equity fund manager that provides “early-stage growth capital” and advisory services to institutions that serve low-income populations in sub-Saharan Africa and India. It invests in organizations that it deems both socially and financially sustainable. As of 2015, Goodwell reports EUR 70 million (USD 76 million) in committed capital and its portfolio comprises six investment funds that support 24 microfinance institutions and mobile payment companies.

About Innovative Microfinance Limited

Founded in 2009, Innovative Microfinance Limited (IML) is a microfinance institution headquartered in Accra, Ghana, that provides credit, savings products, financial education, business development training and advisory on environmental issues to low-income individuals and microenterprises. Its founding shareholders are Sheila Azuntaba and Ghana-based African Tiger Holdings. Information on the percentage of equity held by each is unavailable. IML serves approximately 7,000 borrowers and 10,000 depositors from its three branches and, as of October 2016, it planned to open five additional branches. The institution does not report to the US-based nonprofit Microfinance Information Exchange (MIX), and financial information on IML is not otherwise available.

Sources and Additional Information:

[1] Goodwell Press Release: “Goodwell invests in Innovative Microfinance Ltd. in Northern Ghana”

[2] Goodwell Presentation: Goodwell MDC III

[3] MicroCapital Universe Profile: Goodwell Investments BV

[4] MicroCapital Universe Profile: Innovative Microfinance Limited

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