MicroEnsure, a subsidiary of US-based microfinance network Opportunity International, and PharmAccess Foundation, a Dutch nonprofit that seeks to strengthen health systems in sub-Saharan Africa, have partnered to launch a health plan serving members of the Kilimanjaro Native Cooperative Union (KNCU), a group of coffee growers in the Kilimanjaro region of northern Tanzania.
Category: Risks
MICROCAPITAL BRIEF: Indian Microfinance Institutions (MFIs) Spandana Sphoorty, Asmitha, Future, Share, Trident Attempt to Raise Up to $218m in New Loans Amidst Efforts to Restructure Existing Debt
Five Indian microfinance institutions (MFIs) are reportedly looking to raise between INR 800 crores (USD 175 million) and INR 1,000 crores (USD 218 million) in new loans even as they wait for word on proposed debt restructuring plans.
MICROCAPITAL BRIEF: BBC World Service Radio Program Wins One World Media Award for Criticism of Microfinance: “Assignment: India’s Microcredit Meltdown”
The One World Award for a Radio Program, presented annually by UK-based nonprofit One World Media to recognize exceptional coverage of issues in the developing world, has been awarded to the BBC World Service, a radio network supported by the UK government, for its piece entitled “Assignment: India’s Microcredit Meltdown.”
MICROCAPITAL BRIEF: CGAP (Consultative Group to Assist the Poor) Microfinance Blog Argues Importance of “Matching Types of Accounts to Types of Needs”
The CGAP Microfinance Blog, which is operated by US-based think tank CGAP (Consultative Group to Assist the Poor), recently posted an article by President Bindu Ananth of IFMR Trust, an affiliate of India’s nonprofit Institute for Financial Management and Research (IFMR), that argues the importance of “matching types of accounts to types of needs” based on several examples from India[1].
MICROFINANCE EVENT: 5th Asian Conference on Microinsurance, July 11 – July 12, 2011, Jakarta, Indonesia
Event Name: 5th Asian Conference on Microinsurance
Event Date: July 11 – July 12, 2011
Event Location: Jakarta, Indonesia
MICROCAPITAL BRIEF: Reserve Bank of India (RBI) Directs Banks to Exercise Additional Due Diligence When Lending to Microfinance Institutions (MFIs)
The Reserve Bank of India (RBI), India’s central banking authority, has indicated that banks must perform additional due diligence when lending to microfinance institutions (MFIs) following RBI’s enactment of microfinance guidelines that capped interest rates for end-borrowers at 26 percent and interest rate margins for MFIs at 12 percent.
MICROFINANCE EVENT: Uniglobal Hosts Central Asian Microfinance Fair 2011, Bishkek, Kyrgyzstan, July 7 – July 8, 2011
Event Name: Central Asian Microfinance Fair 2011
Event Date: July 7 – July 8, 2011
MICROCAPITAL BRIEF: Central Bank of Afghanistan Issues Electronic Money Institution License to M-Paisa
The Central Bank of Afghanistan has issued an electronic money institution (EMI) license to M-Paisa, a mobile technology platform that provides financial services targeted at those without access to banking.
MICROCAPITAL BRIEF: Wholesale Lenders Agree to Restructure Debt of Indian Microfinance Institution (MFI) Spandana Sphoorty Financial Limited
A group of lenders, led by Indian commercial bank ICICI Bank, has approved a debt restructuring plan for Spandana Sphoorty Financial Limited, an Indian microfinance institution (MFI).
MICROCAPITAL BRIEF: Global Entrepreneurship Program: Is There Greater Need for Investment in Small and Medium-Sized Enterprises (SMEs) Than in Microfinance?
Alan Patricof, Founder and Managing Director of US-based venture capital company Greycroft Partners, argues in a recent issues of Fortune magazine that while microfinance institutions (MFIs) “do play an important role in development, there is an even greater need to support small and medium-sized enterprises (SMEs), which have the greatest potential for job growth in most places around the world” [1].
MICROCAPITAL BRIEF: MFTransparency Updates Pricing Data for Cambodia’s Microfinance Industry
MFTransparency, a US-based nongovernmental organization (NGO) that provides information on credit products and pricing, has published updated pricing data for Cambodia. The updated data builds on the original data published in 2009 as part of its collection of international microloan product pricing data.
MICROCAPITAL BRIEF: Stanford Social Innovation Review (SSIR) Blog, Ignacio Mas, John Staley Offer Regulators, Financial Service Providers Ideas to Increase Financial Inclusion
Ignacio Mas, Senior Advisor to the Financial Services for the Poor Initiative at the Bill & Melinda Gates Foundation, and John Staley, Director of Finance and Shared Services at Equity Bank of Kenya, recently posted an entry on the Stanford Social Innovation Review (SSIR) blog titled “Are We Serious About Financial Inclusion for All?” [1]. Mr Mas and Mr Staley highlight the importance of increasing access to financial services in developing countries and outline their four suggestions for regulators and financial service providers to advance financial inclusion.
MICROCAPITAL BRIEF: CGAP (Consultative Group to Assist the Poor) Focus Note Examines Cross-Border Funding of Microfinance
A new Focus Note from CGAP (Consultative Group to Assist the Poor) examines data from CGAP’s annual surveys on cross-border microfinance funding to provide an overview of the microfinance funding landscape and trends in cross-border funding [1].
MICROCAPITAL BRIEF: Fondazione Giordano Dell’Amore Accepting Applications for Microfinance Best Practices International Award 2011
Fondazione Giordano Dell’Amore, an Italian foundation, is accepting applications for its Microfinance Best Practices International Award 2011. The award aims to increase the understanding of microfinance as a tool to fight poverty and social exclusion and to encourage microfinance practitioners to share successful practices. The focus of the award for 2011 is “transparency, client protection and social impact.”
MICROCAPITAL BRIEF: CGAP (Consultative Group to Assist the Poor) Microfinance Blog Explores Effects of Arab Upheaval on Microfinance Institutions (MFIs)
CGAP Microfinance Blog, operated by US-based think tank CGAP (Consultative Group to Assist the Poor), recently posted an article by Mohammed Khaled, a CGAP representative for the Middle East-North Africa Region, that explores the implications for microfinance institutions (MFIs) of the recent wave of demonstrations and resulting leadership changes that have occurred in the Middle East and North Africa. Mr Khaled says that while it “could be too early to analyze the impact of recent events in the Arab world on microfinance, one can conclude some general and common lessons despite differences among countries” [1]. Mr Khaled argues that the following areas are of the utmost importance: emergency plans, strategic partnerships with clients, internal control systems and job creation [1].
MICROCAPITAL BRIEF: Rally for Dr Yunus Follows His Removal as Head of Grameen Bank, Analysts Discuss Future Implications
In Bangladesh, 3.7 million people have reportedly signed a petition urging the prime minister of Bangladesh to allow Dr Yunus to continue as the head of Grameen Bank. The event, organized by “The Citizens’ Committee to Protect the Honour of Nobel Laureate Professor Yunus,” was held after the Bangladesh High Court upheld the argument of the government of Bangladesh invalidating the original appointment of Dr Yunus as the managing director of Grameen Bank.
MICROCAPITAL BRIEF: India’s Business Standard Reports a Third of Indian Banks’ Loans to Microfinance Institutions (MFIs) in Restructuring, Which Analysts Argue is Inadequate to Solve Sector Issues
The Business Standard, an Indian financial newspaper, recently reported that a third of the loans made by Indian banks’ to microfinance institutions (MFIs) are in the process of being structured, due to the MFIs inability to repay following the turmoil in the sector in the state of Andhra Pradesh that began in late 2010. According to a report by the Malegam Committee, a sub-committee of the Reserve Bank of India, as of March 2010 approximately INR 138 billion (USD 3.06 billion) in loans were outstanding to MFIs from the Small Industries Development Bank of India, a government-owned bank providing credit to medium and large-scale MFIs and other banks. The report also stated that banks hold an additional INR 42 billion (USD 932 million) in securitized paper from MFIs.
MICROCAPITAL BRIEF: Funding Shortage Continues in Indian State of Andhra Pradesh, Loans Overdue to SKS Microfinance Total $27m
London-based news agency Reuters recently reported that since the October 2010 passage of legislation by the state government of Andhra Pradesh in response to the turmoil in the microfinance sector there, funding still remains an issue for microlenders. This is despite efforts by India’s central bank, the Reserve Bank of India, to ease the liquidity crunch. According to Reuters, the issues of mission drift among for-profit players – putting short-term profits ahead of sustainability – and an uncertain regulatory outlook have contributed to the funding shortage [1]. Reuters also states that domestic lenders exercising extra caution when lending to Indian microfinance institutions (MFIs) further deter foreign investors [1].