Fonkoze, a Haiti-based microfinance institution (MFI), has initiated the claims process for its clients that were affected by recent heavy rains in Haiti. Torrential rains have caused mudslides, flooding and widespread destruction of property in Haiti during June 2011. In response, Fonkoze will be making payments under its catastrophe recovery product, which was launched in January 2011 as a required add-on bought by all Fonkoze clients at the time of their loan disbursement. Clients who have lost their homes or their business as a result of the rains will receive a cash payout of HTG 5,000 (USD 125) to meet emergency needs such as food, shelter, water and temporary shelter. Fonkoze reports, “these clients will also receive a reimbursement of the balance of their existing loan and a new loan when they are ready to restart their business” [1].
Category: Risks
MICROCAPITAL BRIEF: Frankfurt School of Finance and Management, Protestant University of Congo Accepting Applications for Masters Degree in Microfinance
Frankfurt School of Finance and Management, a private German university, in partnership with Protestant University of Congo, a post-secondary college based in the Democratic Republic of the Congo, is issuing a call for applications for a Masters in Microfinance offered at the Protestant University of Congo.
MICROFINANCE EVENT: Boston Microfinance Club Hosts Panel Discussion, “Beyond the Initial ‘Hype’: The Future of Microfinance”, June 21, 2011, Boston, Massachusetts, USA
Event Name: Beyond the Initial ‘Hype’: The Future of Microfinance
Event Date: June 21, 2011
Event Location: Boston, Massachusetts, United States
MICROFINANCE PAPER WRAP-UP: An Emerging Platform: From Money Transfer System to Mobile Money Ecosystem; By Jake Kendall, Bill Maurer, Philip Machoka and Clara Veniard; Published by University of California Irvine School of Law
By Jake Kendall, Bill Maurer, Philip Machoka and Clara Veniard; published by UC Irvine School of Law; May 2011; 15 pages; available at: http://ssrn.com/abstract=1830704
MICROCAPITAL BRIEF: Reporting Tepid Growth, State Bank of Pakistan (SBP) Permits Microfinance Institutions (MFIs) to Accept Gold as Collateral
The State Bank of Pakistan (SBP) is reported to be permitting microfinance institutions (MFIs) to accept gold as collateral to secure microfinance loans. International: The News, a Pakistan-based news source, speculates that SBP has changed its stance on the issue in an effort to boost the issuance of loans following the floods that greatly affected Pakistan in 2010. In a circular reportedly issued to all MFIs in the country, SBP stated, “the negative growth [in 2010] was mainly due to the devastating floods during the third quarter of 2010 that gripped most parts of the country…Moreover, an overall difficult macroeconomic environment continues to challenge the credit growth of microfinance players” [1].
MICROCAPITAL BRIEF: Swiss Re to Assist International Finance Corporation (IFC) With Global Index Insurance Facility (GIIF) For West Africa
International Finance Corporation (IFC), the private-investment arm of the World Bank Group, and Swiss Re Corporate Solutions (Swiss Re), a reinsurer and financial services group based in Zurich, Switzerland, have partnered to further develop the Global Index Insurance Facility (GIIF) [1]. Index insurance is a product that covers farmers against presumed crop failure based on measurable factors such as if rainfall is below a predetermined threshold. GIIF was launched by IFC in 2009 as a regional platform intended “to develop agricultural insurance systems in West African countries including Senegal, Mali and Burkina Faso” [2].
MICROCAPITAL BRIEF: Association of Microfinance Institutions in Rwanda (AMIR) Cautions Microfinance Institutions (MFIs) Against “One-Size-Fits-All” Approach, Particularly in Rural Areas
The Association of Microfinance Institutions in Rwanda (AMIR), an 84-member organization that was established in 2007 to build the capacity of the microfinance industry in Rwanda, has cautioned microfinance institutions (MFIs) in Rwanda regarding the risks of offering the same financial products to all clients.
MICROFINANCE PAPER WRAP-UP: Microfinance and Social Investment; By Jonathan Conning and Jonathan Morduch; Published by The Financial Access Initiative (FAI) at New York University’s Robert F Wagner Graduate School of Public Service and Hunter College
By Jonathan Conning and Jonathan Morduch; published by Financial Access Initiative (FAI) at New York University’s Robert F Wagner Graduate School of Public Service and Hunter College; April 8, 2011; 30 pages; available at: http://financialaccess.org/sites/default/files/Microfinance%20&%20Social%20Investment_Conning&Morduch.pdf
MICROCAPITAL BRIEF: Paper Gains on Early Investment in SKS Microfinance Largely Evaporate For Sequoia Capital
Since its initial investment in SKS Microfinance, an India-based microfinance institution (MFI), Sequoia Capital, a US-based venture capital firm, has experienced significant gains on paper followed by partial losses of those gains.
MICROCAPITAL BRIEF: Nigeria’s Capital Express Assurance Purchases Majority Shareholding in Kenya’s Capex Life Insurance, Which Plans to Downsize to Focus on Microfinance
Capital Express Assurance, a Nigeria-based life insurance company, has purchased a majority shareholding in Capex Life Assurance, a Kenya-based life insurance company formerly known as Trinity Life Assurance. Capital Express Assurance purchased a 65 percent stake in Capex Life Assurance for USD 975,000 [1]. The remaining 35 percent stake was purchased by a group of individual Kenyan investors led by current Capex Life Assurance general manager, James Macharia [1].
MICROCAPITAL BRIEF: Panel Discusses Balancing Profit, Mission, Impact at Microfinance USA Conference 2011, Presented by Opportunity Fund, ACCION, Kiva, in New York City, May 23 – 24
Opportunity Fund, a nonprofit organization based in the US state of California that offers microloans and microsavings primarily to people in the San Francisco Bay area; ACCION International, a microfinance organization that provides lending and financial education to small businesses in twenty-three countries; and Kiva, a US-based online portal that allows individuals to make loans to microfinance institutions (MFIs) for on-lending to poor people in sixty countries, hosted the Microfinance USA Conference 2011 on May 23 and May 24 in New York City.
MICROCAPITAL BRIEF: Costs Rise for Indian Microfinance Institutions (MFIs) Looking to Securitize Loan Portfolios From 10% to Over 12%
Indian microfinance institutions (MFIs), which have struggled to procure loans from commercial banks since turmoil struck the microfinance industry in Andhra Pradesh in November 2010, have found that raising money by securitizing even their higher-quality loan portfolios has become more expensive.
MICROCAPITAL BRIEF: Haiti Mobile Money Initiative, Managed by World Council of Credit Unions (WOCCU), Continues to Seek Recipients for $12m in Grants for Development of Mobile Payment Platforms from Gates Foundation, USAID
The Haiti Mobile Money Initiative (HMMI), a competition developed by the Haiti Integrated Finance for Value Chains and Enterprises (HIFIVE) that provides prize money from the Bill and Melinda Gates Foundation and US Agency for International Development (USAID), continues to accept proposals from private sector organizations to develop mobile money services in Haiti.
MICROCAPITAL BRIEF: Members of “No Pago” Movement in Nicaragua Propose to Pay Back Microfinance Debts Over 10 Years, Government Would Repay $25m Upfront
Members of the “No Pago” (No Payment) Movement, in which thousands of Nicaraguan borrowers refused to pay back outstanding loans beginning in 2009, have proposed a deal wherein the government would immediately repay debts to microfinance institutions (MFIs) worth USD 25 million and the debtors would pay the government back over ten years.
MICROCAPITAL BRIEF: Microfinance Information Exchange (MIX) Publishes Working Draft of “Microfinance, Financial Crises, and Fluctuations in Food and Fuel Prices” by Adrian Gonzalez
Microfinance Information Exchange, a US-based, nonprofit data provider, recently drafted a paper entitled “Microfinance, Financial Crises, and Fluctuations in Food and Fuel Prices” that examines the potential impact of large-scale financial crises on the microfinance sector.
MICROCAPITAL BRIEF: Islamic Microfinance Can Spur Development, Argues Khan from Care International UK
Mr Ajaz Khan, microfinance adviser for nonprofit organization Care International UK, suggests in an article on the “Poverty matters blog” on the website of the UK’s Guardian newspaper that Islamic microfinance has strong potential to support socioeconomic development.
MICROCAPITAL BRIEF: United Nations Development Program (UNDP) Convenes Discussion On Amending Microfinance Regulations in Uzbekistan
United Nations Development Program (UNDP), the United Nations’ global development network that seeks to connect countries to knowledge, experience and resources to help people build a better life, organized a session recently to discuss amendments to microfinance regulations in Uzbekistan.
MICROCAPITAL BRIEF: World Vision Tanzania, MicroEnsure Partner to Launch Agricultural Microfinance Loans Bundled with Weather Index Insurance
World Vision Tanzania, a branch of US-based, Christian relief organization World Vision, in partnership with MicroEnsure, a subsidiary of US-based microfinance network Opportunity International, has launched a pilot scheme to provide small-scale farmers in Tanzania with agricultural loans bundled with weather index insurance.