MICROCAPITAL BRIEF: Microfinance Operations in Lebanon Begin to Grow

As microfinance institutions in Lebanon are providing credit to more borrowers that are unserved by commercial banks, Director of Financial Operations at the Central Bank of Lebanon, Youssef Khalil, reports “microfinance is filling – modestly filling – part of this gap.” The Daily Star newspaper cites an unnamed 2009 World Bank study indicating that Lebanon’s aggregated gross microloan portfolio of approximately USD 150 million serving 38,000 to 55,700 active borrowers falls well short of reaching the 190,000 potential borrowers in the country.

In 2004, the Central Bank of Lebanon approved a regulation that exempted commercial banks from reserve requirements if they gave out small loans for entrepreneurial efforts. This initiative resulted in a 3.5 percent increase in microlending [1].

Two microfinance institutions in Lebanon report gross loan portfolio (GLP) data for 2009 to the Microfinance Information Exchange: Ameen has a GLP of USD 28 million and Al Majmoua, an NGO, has a GLP of USD 14 million. A third MFI, Emkan, also an NGO, has a presence in six Lebanese regions with a GLP of USD 10 million.

About Ameen: Ameen is a microfinance institution (MFI) created in Lebanon in 1999 as a program of CHF International, a US-based development and humanitarian organization. Now an independent entity, it seeks to provide financial and businesses development services to support small entrepreneurs. As of 2009, Ameen reports to the Microfinance Information Exchange (MIX) assets of USD 34 million, a gross loan portfolio of USD 28 million, return on assets of 2.22 percent and return on equity of 10.87 percent.

About Emkan: Emkan is a non-governmental organization (NGO) in Lebanon that registered with the Lebanese Ministry of Interior in 2008 and began microlending operations in 2009. It aims to improve the standard of living for Lebanon’s poor population by providing financial services that stimulate job opportunities. Its products consist of individual loans, home improvement loans and consumer loans that range from LBP 500,000 (USD 330) to LBP 7,500,000 (USD 5,000). Loans supporting small and medium-sized enterprises (SMEs) range from LBP 7,500,000 (USD 5,000) to LBP 15,000,000 (USD 10,000). Emkan does not report financial information to the Microfinance Information Exchange (MIX).

About Al Majmoua: Al Majmou, also known as the Lebanese Association for Development, is a nongovernmental organization (NGO) that was launched in 1994 as a microcredit program of Save the Children, a UK-based an international aid organization. Al Majmoua aims to provide low-income Lebanese with the tools to become financially independent. As of June 2009, Al Majmoua reports to the Microfinance Information Exchange (MIX) USD 15 million in assets, a gross loan portfolio (GLP) of USD 14 million, return on assets of 10.99 percent and return on equity of 13.8 percent.

By Diana Baide, Research Assistant

[1] The Daily Star. “Microfinance slowly but surely making headway in Lebanon” by Tamara Qiblawi, 13 November 2010

http://www.dailystar.com.lb/article.asp?edition_id=1&categ_id=3&article_id=121506#axzz15Hqt9INx

MicroCapital’s Microfinance Universe profile: Ameen

https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Ameen

MicroCapital’s Microfinance Universe profile: Al Majmoua

https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Al+Majmoua

MicroCapital’s Microfinance Universe profile: Emkan

https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Emkan

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

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