Grameen Foundation, a US-based nonprofit; Grameen Capital India, a Mumbai-based social business that promotes growth in the microfinance sector in India; and Grameen-Jameel, a joint venture founded in 2007 by the Grameen Foundation and Grow Well Limited of Saudi Arabia, have launched a new initiative to address the liquidity needs of Indian microfinance institutions (MFIs) that demonstrate a focus on social as well as financial returns.
The group will make available USD 8 million to guarantee funds loaned to poverty-focused MFIs from local banks. The funds will comprise USD 4 million in guarantees each from Grameen Foundation and Grameen-Jameel, and will be facilitated by Grameen Capital India.
To be eligible for consideration, MFIs must have completed a social-rating or impact-assessment report, using “recognized industry guidelines”, in the past year.
By Witt Gatchell, Research Associate
About Grameen Foundation:
The Grameen Foundation, a nonprofit based in Washington, DC, aims to help microfinance institutions throughout the world replicate the microfinance model of the Grameen Bank https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Gra…. It provides financial, technological and managerial support to provide new business opportunities and telecommunication services for poor people in rural areas. Though the Grameen Foundation is independent of the Grameen Bank, Muhammad Yunus, the founder of the Grameen Bank, serves on the foundation’s Board of Directors. Grameen Foundation reported total assets of USD 33.1 million as of March 31, 2010.
About Grameen Capital India:
Grameen Capital India is a “social business” based in Mumbai that promotes microfinance as an asset class and aims to enable microfinance institutions (MFIs) to develop wider access to capital markets. It is a collaboration between Grameen Foundation USA, IFMR Trust and Citigroup. Its focus is on: “Developing access to capital markets, initially in India, through securitization and other appropriate financial vehicles; structuring and arranging credit enhancements/ first loss guarantees to support the investment grade rating of the senior securities and working closely with the rating agencies to achieve required ratings at the most optimal cost; and advising MFIs on the standards of governance, accounting, reporting, and transparency necessary to satisfy commercial financing sources.” Financial information is unavailable for Grameen Capital India.
About Grameen-Jameel:
Established in 2007, Grameen-Jameel is a joint venture of the US-based Grameen Foundation and Grow Well Limited of Saudi Arabia. The company forms partnerships primarily with Arab microfinance institutions (MFIs) through which it provides information technology (IT) support, human resources (HR) management, operational support and financing in the form of partial credit guarantees. As of 2008, Grameen-Jameel had facilitated local currency financing of USD 44 million backed by USD 20 million in guarantees to MFIs and had reached more than 350,000 new microfinance clients through its partners in Egypt, Jordan, Lebanon, Morocco, Palestine, Tunisia and Yemen.
Sources and Additional Resources:
[1] Grameen Foundation Press Release: “Grameen Foundation, Grameen Capital India and Grameen-Jameel Join Forces to Address Funding Constraints Facing Socially-Focused Indian Microfinance Institutions” http://www.grameenfoundation.org/press-releases/grameen-foundation-grame…
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MicroCapital Universe Profile: Grameen Foundation https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Gra…
MicroCapital Universe Profile: Grameen Capital India
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Gra…
MicroCapital Universe Profile: Grameen-Jameel
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Gra…
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