MICROCAPITAL BRIEF: Allianz Commits $24m to Final Close of Huruma Fund, Investor in Rural Microfinance

Huruma Fund, a public-private partnership that invests in lenders to smallholder farmers in low- and middle-income countries, recently accepted an investment of EUR 20 million (USD 23.7 million) from German financial services firm Allianz Group as part of the fund’s final closing, bringing its total size to EUR 120 million (USD 142 million). Since the fund’s launch late in 2020, Huruma has attracted a total of EUR 90 million (USD 107 million) from private investors. In addition to Allianz, these investors are UK-based impact investment firm Ceniarth; US-based financial technology firm I-Capital; US-based Libra Foundation; and multiple clients of Spain-based Caixa Private Bank. Huruma has also raised a first-loss tranche of EUR 10 million (USD 11.9 million) from the EU’s European Commission and EUR 20 million (USD 23.7 million) in debt funding from Fondo para la Promoción del Desarrollo (FONPRODE), an instrument of the Spanish government’s Agencia Española de Cooperación Internacional para el Desarrollo.

Huruma is led by Compañia Española de Financiación del Desarrollo (COFIDES), a development finance institution backed by the government of Spain. Gawa Capital Partners, a private firm based in Spain, serves as the fund’s investment advisor. The goal of Huruma is to “improve access to finance in rural areas [including] the financial supply to small or excluded farmers in Latin America, the Caribbean, Sub-Saharan Africa and Asia.” This includes providing capital and technical assistance to microfinance institutions that invest in smallholder farmers.

The CEO of COFIDES, José Luis Curbelo, said the capital invested in Huruma, “proves the importance of combining private and public resources from different sources to structure sustainable financing models where each stakeholder can contribute their own perspective and requirements regarding the risk assumed and the expected return.”

Founded in Berlin in 1890, Allianz Group provides insurance and asset management services to 100 million customers in 70 countries. For 2020, it reported total revenue of EUR 140 billion (USD 167 billion) on EUR 2.8 trillion (USD 3.3 trillion) in assets under management.

By Sophie Fiala, Research Associate

Sources and Additional Resources

Direct contact with COFIDES

COFIDES profile on Huruma
https://www.cofides.es/en/our-work/success-stories/fondo-huruma

Allianz Group homepage
https://www.allianz.com/

Allianz Group 2020 report
https://www.allianz.com/content/dam/onemarketing/azcom/Allianz_com/investor-relations/en/results-reports/annual-report/ar-2020/en-Allianz-Group-Annual-Report-2020.pdf

Gawa Capital homepage
https://www.gawacapital.com/

Agencia Española de Cooperación Internacional para el Desarrollo profile on FONPRODE
https://www.aecid.es/aecid/fonprode

Caixa Private Bank homepage
https://www.caixabank.es/

Ceniarth homepage
https://ceniarthllc.com/

I-Capital homepage
https://www.icapitalnetwork.com/

Libra Foundation homepage
https://www.thelibrafoundation.org/