MICROCAPITAL BRIEF: Multilateral Investment Fund (MIF) Donates $1.2m to Effort by Center for Latin American Monetary Studies to Improve Remittance Market in Latin America

The Multilateral Investment Fund, a member of the US-based IDB (Inter-American Development Bank) Group, has donated USD 1.2 million to fund a collaborative project with the Center for Latin American Monetary Studies, an association of Latin American and Caribbean central banks (also known by its Spanish acronym CEMLA). The project seeks to improve the legal and regulatory frameworks of the region’s remittance market and improve the quality of information available on the sector. This is to include addressing legal and regulatory barriers that hinder remittances such as “onerous requirements for opening accounts,” restrictions on direct deposits of remittances to electronic wallets or bank accounts, and obstacles to constructing distribution channels that may have lower costs, including agent networks and mobile technology.

As of 2015, international remittances are responsible for an annual inflow of roughly USD 60 billion to Latin American and Caribbean nations, these funds, which are primarily sent in installments by migrants living in the United States and Spain, are an opportunity for improving the financial inclusion of roughly 40 million remittance recipients.

From its inception in 1993 through 2013, MIF reports having approved 1,750 projects in 19 countries, disbursing approximately USD 100 million per year in grants, equity investments and loans.

By Makai McClintock, Research Associate

About Multilateral Investment Fund (MIF)
The Multilateral Investment Fund (MIF) is an autonomous fund that was founded in 1993 by the US-based Inter-American Development Bank (IDB). Now a member of the IDB Group, MIF has 39 donating member countries from the Americas, Asia and Europe. From its inception in 1993 through 2013, MIF reports having approved 1,750 projects in 19 countries, disbursing approximately USD 100 million per year in grants, equity investments and loans.

About Inter-American Development Bank (IDB)
The Inter-American Development Bank (IDB) is a US-based multilateral finance institution that was established in 1959 and operates in Latin America and the Caribbean. IDB works with governments, companies and nongovernmental organizations (NGOs) to provide both loans and grants to support small and medium-sized enterprises (SMEs), health, education and other sectors. IDB also provides technical assistance and research in these areas. With 48 member countries, IDB is headquartered in Washington, DC, with offices also in Japan, France and all 26 member countries in Latin America and the Caribbean. As of December 2013, IDB reported total assets of USD 97 billion.

About Center for Latin American Monetary Studies (CEMLA)
Established in September 1952 and headquartered in Mexico, the Center for Latin American Monetary Studies (also known by its Spanish acronym CEMLA) is an association of Latin American and Caribbean central banks seeking to promote a better understanding of monetary and financial topics in the region. It also aims to inform the public on developments in regional and global monetary and financial policy issues. CEMLA conducts research and provides seminars and training courses to central bank and other financial agency personnel. In 2012, CEMLA, together with the World Bank and the Multilateral Investment Fund of the IDB (Inter-American Development Bank) group, launched Envia Centro America, an online tool that allows users to compare the cost and speed of sending remittances from the United States to Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama and the Dominican Republic, as well as from Costa Rica to Nicaragua.

Sources and Additional Resources:

CEMLA Press Release: “CEMLA and FOMIN will promote the development of an enabling environment for the financial inclusion of remittance clients,” http://www.fomin.org/en-us/Home/News/PressReleases/ArtMID/3819/ArticleID/2999/-CEMLA-and-FOMIN-will-promote-the-development-of-an-enabling-environment-for-the-financial-inclusion-of-remittance-clients.aspx

MicroCapital Universe Profile: Multilateral Investment Fund (MIF)

MicroCapital Universe Profile: Inter-American Development Bank

MicroCapital Universe Profile: Center for Latin American Monetary Studies (CEMLA)

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