The International Finance Corporation (IFC), the investment arm of the World Bank, recently announced that it will provide an equity investment of USD 15 million in Lok II, a venture capital fund investing primarily in microfinance. Lok II is sponsored by the Lok Foundation, a non-profit corporation based in New York. The investment will comprise approximately 19 percent of the fund’s total size, USD 80 million. The fund will be based in Mauritius and invest primarily in Indian microfinance institutions (MFIs). No other investors have been specified. The fund is advised by Lok Advisory Services (LAS), a wholly-owned subsidiary of the Lok Foundation that is located in India. Lok II follows Lok Capital LLC, a USD 22 million fund that was founded in 2006 by Lok Capital Group, an organization consisting of the funds as well as the Lok Foundation.
By Christopher Maggio, Research Assistant
About
International Finance Corporation (IFC)
Description
A member of the World Bank Group, the International Finance Corporation (IFC) uses loan and debt securities, equity investments and guarantees with the intent of alleviating poverty. It invests in financial institutions and other companies in emerging markets as well as providing technical assistance. The IFC has 182 member countries that “collectively determine its policies, and approve investments.” In fiscal year 2009, its new investments totaled USD 14.5 billion.
About
Lok II
Description
Lok II is a venture capital fund that is based in Mauritius and invests primarily in Indian microfinance institutions (MIFs). It was founded in 2010 and is sponsored by the Lok Foundation, a non-profit corporation based in New York. The International Finance Corporation (IFC), the investment arm of the World Bank, has committed USD 15 million in equity to the fund, 20 percent of the fund’s total size of USD 80 million. As of May 3, 2010, no other investors have been specified.
About
Lok Capital LLC
Description
Lok Capital LLC is a limited-life limited-liability company based in Mauritius that provides equity and equity-linked investments to microfinance institutions (MFIs) in India. The fund was launched in 2006 with USD 22 million. Investors include ACCION International, Commonwealth Development Corporation (CDC), Developpement International Desjardins, Netherlands Development Finance Company (FMO), International Finance Corporation (IFC), KfW, and responsAbility. The average investment size ranges from USD 500,000 to USD 3 million. The Lok Foundation was created along with Lok Capital LLC to provide specialized technical assistance to Indian MFIs.
Additional Resources
VC Circle article entitled ‘IFC To Invest $15M In MFI Fund Lok II’: http://www.vccircle.com/500/news/ifc-to-invest-15m-in-mfi-fund-lok-ii
MicroCapital’s Microfinance Universe: International Finance Corporation (IFC)
MicroCapital’s Microfinance Universe: Lok II
MicroCapital’s Microfinance Universe: Lok Capital LLC
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