MICROCAPITAL BRIEF: Microserfin to Boost Farm Microinsurance, Microloans in Panama with $2.3m in Debt Finance from Huruma Fund

Microserfin, a lender to homeowners as well as micro-, small and medium-sized enterprises (MSMEs) in Panama, recently borrowed EUR 2 million (USD 2.3 million) from Huruma Fund, a Spain-based public-private partnership supporting rural finance in low- and moderate-income countries. Microserfin, which is controlled by the Spain-based Fundación BBVA Microfinanzas, serves 14,000 clients with financial products; financial education; and access to a 24-hour hotline for assistance with health, legal, agricultural and veterinary emergencies. The microlender’s upcoming plans include redesigning its agricultural insurance products.

BBVA Microfinanzas was launched by the Spanish bank Banco Bilbao Vizcaya Argentaria (BBVA) in 2007. As of 2020, the six microfinance institutions controlled by BBVA Microfinanzas serve a total of 2.6 million clients – mostly women – with the equivalent of USD 1.1 billion in credit outstanding and USD 720 million in client deposits. These operations are located in Chile, Colombia, the Dominican Republic, Panama and Peru.

The goal of Huruma is to improve financial access for small-scale farmers in Africa, Asia, Latin America and the Caribbean. The fund is led by Spain’s Compañia Española de Financiación del Desarrollo (COFIDES), a government-backed development finance institution. Gawa Capital Partners, a private firm also based in Spain, serves as the fund’s investment advisor. Huruma has a volume of EUR 120 million (USD 140 million), of which three quarters is from private investors. As of February 2022, it has deployed EUR 30 million (USD 34 million) in debt and equity investments, all in Latin America.

Gawa is a Spain-based impact investing fund manager. Founded in 2009 by Agustin Victoria and Luca Torre, the firm aims to “improve the life of low-income communities by promoting investment in social enterprises.” As of 2021, Gawa advises four impact investment funds with a total value of EUR 196 million (USD 226 million). Gawa launched three of those funds, Gawa Microfinance Fund, Global Financial Inclusion Fund and Huruma Fund.

COFIDES is controlled by three entities of the Spanish government. Its other shareholders are three Spanish banks and the CAF Development Bank of Latin America, which is based in Venezuela and was formerly known as Corporacion Andina de Fomento. COFIDES manages funding from the EU, the UN Green Climate Fund and the following entities owned by the government of Spain: Fondo para Inversiones en el Exterior (FIEX), Fondo para Operaciones de Inversión en el Exterior de la Pequeña y Mediana Empresa (FONPYME) and Fondo para la Promoción del Desarrollo (FONPRODE). As of the close of its 2020 fiscal year, COFIDES managed assets totaling EUR 1.1 billion (USD 1.3 billion).

Sources and Additional Resources

Huruma press release
https://fondohuruma.com/en/the-huruma-fund-completes-two-investments-in-panama-aimed-at-farmers-in-underserved-areas/

Microserfin homepage
https://microserfin.com/

BBVA Microfinanzas homepage
https://www.fundacionmicrofinanzasbbva.org/

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

COFIDES homepage
https://www.cofides.es/

More news from MicroCapital on Huruma
https://www.microcapital.org/?s=Huruma

Did you know that MicroCapital publishes the MicroCapital Monitor newspaper each month? Find out more at https://www.microcapital.org/products-page/.