MICROCAPITAL BRIEF: Incofin Invests $6m in Peer-to-peer Lender Amartha from Inclusive Finance Fund, Microfinance Enhancement Facility (MEF) to Increase Group Lending to Female Entrepreneurs in Rural Indonesia

Amartha, a firm offering peer-to-peer lending and other services in Indonesia, recently gained access to USD 6 million in debt financing from the Belgian impact investing firm Incofin Investment Management in an attempt to boost access to financial services for women entrepreneurs in rural Indonesia. Two thirds of the total invested comes from the Microfinance Enhancement Facility (MEF), and the remainder is sourced from the Incofin Inclusive Finance Fund. MEF is a joint initiative of the German development bank Kreditanstalt für Wiederaufbau (KfW), the Austrian development bank Oesterreichische Entwicklungsbank AG (OeEB) and the World Bank Group’s International Finance Corporation.

Founded in 2010, Amartha offers an online platform through which groups of rural women may access enterprise loans ranging from IDR 3 million (USD 200) to IDR 10 million (USD 700), crowdfunded by individuals and entities in amounts as low as IDR 100,000 (USD 7). The organization performs credit evaluations through a mix of in-person and technological means that allows the firm to lend to women without need for credit histories. Amartha also offers training pertaining to entrepreneurship and financial literacy. As of 2022, the company serves approximately 470,000 entrepreneurs via 480 branches in the provinces of Java, Sumatra and Sulawesi. The firm has distributed loans totaling IDR 6.99 trillion (USD 465 million) to 1 million women since its launch.

Founded in 2001, Incofin is a for-profit firm that seeks “to promote inclusive progress.” As of 2022, it had 350 investees in 65 countries, mostly active in financial inclusion and agriculture. Incofin’s portfolio is valued at USD 1.2 billion and comprises funds affiliated with organizations such as the Belgian cooperative BRS, the German firm Invest in Visions, and Belgium’s vdk bank. Incofin has offices in Belgium, Colombia, Cambodia, India and Kenya.

By Hasnat Aslam, Research Associate

Sources and Additional Resources

Incofin press release
https://incofin.com/incofin-invests-in-indonesian-fintech-to-increase-financial-inclusion/

Amartha homepage
https://amartha.com

Incofin homepage
https://incofin.com

MEF homepage
https://www.mef-fund.com

IFC homepage
https://www.ifc.org

KfW homepage
https://www.kfw.de

OeEB homepage
https://www.oe-eb.at

Previous MicroCapital story on Amartha
https://www.microcapital.org/microcapital-brief-amartha-raises-28m-in-equity-from-mandiri-mdi-uob-wwb-for-credit-scoring-e-commerce-peer-to-peer-lending-for-women-microentrepreneurs-in-rural-indonesia/

Previous MicroCapital story on Incofin
https://www.microcapital.org/microcapital-brief-incofin-investment-management-names-buysens-peetermans-co-ceos/

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