Subtitled “Financial Inclusion and the Future of Work,” the 19th annual conference of the Belgium-based European Microfinance Network (EMN) will focus on changes in the labour market brought about by the COVID-19 pandemic along with rapid technological advances. The agenda will focus on how the microfinance industry can respond to
MICROCAPITAL BRIEF: BlueOrchard Executes IIF Equity Buy into Forte Insurance to Boost Agricultural Microinsurance in Cambodia
Switzerland’s BlueOrchard Finance recently disbursed an equity placement of undisclosed size from the InsuResilience Investment Fund (IIF), a Luxembourg-domiciled public-private partnership, for IIF to buy a minority stake in Cambodia’s Forte Insurance Group. BlueOrchard’s investment director for the continent, Thibaud Ponchon, expressed confidence that the placement will “drive the penetration of
MICROCAPITAL BRIEF: Solaris Offgrid Adds NuovoPay to PaygOps Platform, Boosting Retailers’ Ability to Lease Smartphones to Unbanked
Two providers of business-to-business services, UK-registered Solaris Offgrid and India’s NuovoPay, recently agreed to make NuovoPay’s smartphone leasing service available to distributors via Solaris’s PaygOps platform with the goal of increasing “access to digital technology for millions of unbanked people in emerging countries.” PaygOps is a system for
MICROCAPITAL BRIEF: Aavishkaar India Fund VI Nets $130m for MSMEs Addressing Climate Change, Agtech, Fintech – Anchored by Public Funding from Domestic, European Sources
Aavishkaar Capital, a subsidiary of India’s Aavishkaar Group, recently completed the first close of its Aavishkaar India Fund VI with commitments totaling INR 10 billion (USD 130 million) to invest mainly in micro-, small and medium-sized enterprises (MSMEs). In particular, Sushma Kaushik, a partner at Aavishkaar Capital, said that the fund aims to
SPECIAL REPORT: Pratibha Singh of Agents for Impact, Arunkumar Padmanabhan of Svasti Discuss the AFISAR Rating, Microfinance, Impact and Much More!
This is part of a series of features sponsored by Agents for Impact (AFI), a German impact investing firm whose products include the AFI Sustainability Alignment Rating (AFISAR©) tool. AFISAR© is a trust mark – in microfinance and other forms of social business – signifying a commitment to positive and enduring change for people and the planet, based on the UN Sustainable Development Goal (SDG) framework.
AFISAR© helps MFIs leverage the market’s growing focus on sustainability performance to raise capital from international investors and, particularly, impact investors. The rating helps investors and social businesses understand their strengths and weaknesses and devise effective strategies to minimize negative impact and maximize positive impact to the benefit of the organization – its employees, clients and other stakeholders – as well as the environment.
The conversation below outlines the AFISAR© rating process carried out in the “direct partnership” format by a leading MFI like Svasti Microfinance. Direct partnership offers a continuous and immersive experience to facilitate sustainable transitions. The active dialogue and engagement embedded in the AFISAR© process enable the MFI as well as asset managers to embark on a journey that leads to long-term sustainable development. AFI highly values long-term partnerships with organizations sharing our mission of achieving the UN SDGs. We take this so seriously that a rating above the sustainability threshold is required for the disbursement funds.
To date, AFI has used AFISAR© to rate 35+ microfinance and SME finance institutions in Asia, East Africa and Eastern Europe, helping the institutions demonstrate their SDG competency and alignment.
Pratibha Singh (pictured): How did you become interested in microfinance?
Arunkumar Padmanabhan: I was a lawyer and had worked for some years with ICICI Bank. Based on that experience, I wanted to set up a commercial business in the social impact space. We started in the slums of Mumbai, and now we have expanded to eight states in India with 220,000 borrowers across 120 branches.
PS: What makes the Svasti model unique?
AP: The key to success in this field is based on three aspects: people, process and technology. Our vision follows the “people-first” approach. Technology and innovation are driving forces as well, and we have built all of our systems from the ground up. That gives us a significant competitive advantage. Meanwhile, we have focussed on client protection and social impact from a very early stage in our development. With AFISAR©, we have become one of the few companies that is measuring its performance based on the SDGs. Constantly trying to improve in impact-driven areas is of great strategic importance.
MICROCAPITAL BRIEF: Max to Boost Financing of Motorcycle Taxis for Okada Drivers in Nigeria with $3m Credit Line from VFD Microfinance Bank, Operator of VBank
Nigeria’s VFD Microfinance Bank, whose primary offering is the VBank online banking service, recently agreed to open a credit line for Max, a Nigeria-based provider of electric and conventional motorbike leasing and other services to taxi drivers. In addition to lending Max up to USD 3 million, the bank will offer Max’s okada drivers
MICROCAPITAL BRIEF: Kinara Capital Raises $50m in Equity from Nuveen, ASN Microkredietfonds to Boost Lending to MSMEs in India
India’s Kinara Capital recently raised INR 3.8 billion (USD 50 million) in equity from the Global Impact Fund of US-based Nuveen, which led the investment round, and ASN Microkredietfonds, which is advised by the Netherlands’ Triple Jump, to boost Kinara’s lending to micro-, small and medium-sized enterprises (MSMEs) in India. According to Kinara Founder and CEO Hardika Shah
MICROFINANCE PAPER WRAP-UP: “Central Bank Digital Currencies: A New Tool in the Financial Inclusion Toolkit?”; by Raphael Auer et al; Published by Bank for International Settlements, World Bank Group
The authors of this study interviewed representatives of nine central banks that are at various stages of exploring the possible creation of central bank digital currencies (CBDCs) with the goal of increasing financial inclusion. Among the barriers to financial inclusion CBDCs might address are:
MICROCAPITAL BRIEF: Aliada Digital Card from NanoPay Offers Financial, Medical, Legal Services to Women in Mexico
Mexico’s NanoPay is targeting its new Aliada Digital Card at women in Mexico. The card, which leverages the network of US-based Mastercard, offers lines of credit as well as a range of free legal and medical services. The medical services include online access to physical and mental health professionals as well as
MICROCAPITAL BRIEF: EBRD Launches GEFF Turkey With $56m Loan to TSKB for On-lending to Reduce, Adjust to Climate Impacts
The European Bank for Reconstruction and Development (EBRD), a UK-based multilateral development finance institution, is “supporting Turkey’s transition to an environmentally sustainable, low-carbon and climate-resilient economy” through the Green Economy Financial Facility (GEFF) Turkey. The loan package comprises funds from EBRD’s own resources as well as concessional financing from the Clean Technology Fund,
MICROCAPITAL BRIEF: Khazna of Egypt Raises $38m in Series A Round Led by Quona, 3 More Fintechs Join in Netting Investments from Nclude Fund
Nclude Fund, which was launched in 2022 primarily to focus on financial technology (fintech) in Egypt, has invested unspecified amounts of funding in four startups: (1) Khazna, a financial services app targeting the underbanked; (2) Lucky, an app offering consumer loans and loyalty rewards; (3) Mozare3, which helps small-scale farmers and food processors find funding; and (4) Paymob, an online payment platform that operates in the Middle East and Africa. Khazna also raised funding from
MICROCAPITAL BRIEF: Women’s World Banking Raises $28m for WWB Capital Partners II, Seeking to Boost Microfinance for Women
The US-based NGO Women’s World Banking (WWB) recently raised USD 28 million for the second and final close of WWB Capital Partners II, bringing its total volume to USD 103 million. The goal of the fund is to “close the gender gap in financial inclusion while demonstrating the business case for gender lens investing by achieving attractive returns for its investors.” Among the features of the fund are: (1) a blended finance structure that stratifies certain risks into separate tiers; and (2) a grant-funded technical assistance facility for performing gender analyses to help portfolio companies recruit and retain more female clients and employees. The
MICROCAPITAL BRIEF: Louis Dreyfus Company Borrowing $100m from ADB to On-lend to Small-scale Farmers to Boost Climate Resilience, COVID-19 Recovery
The Asian Development Bank (ADB), a multilateral institution based in the Philippines, recently agreed to lend USD 100 million to Louis Dreyfus Company (LDC), a Netherlands-based firm active in agriculture, food processing and shipping. LDC plans to use the funds to finance “coffee, cotton and rice inventories” for 50,000 smallholder farmers who supply the firm’s operations in India, Indonesia, Pakistan, Thailand and Vietnam. Among the goals of the project are to
MICROFINANCE PAPER WRAP-UP: “Outcomes Management for Financial Service Providers: A Proposed Standard Framework Aligned With the Sustainable Development Goals,” Published by European Microfinance Platform, Cerise, Social Performance Task Force
This paper builds on the publishers’ past work to create an updated “methodology for outcomes management and a set of standard outcomes indicators” that are mapped to the UN’s Sustainable Development Goals (SDGs) and the targets that make up each SDG. The aim is for the indicators to be “actionable” and the methodology to be “simple” to
MICROCAPITAL BRIEF: ADA to Promote Financial Inclusion in Niger via Improved Product Design, Supervision, Funding Framework
Appui au Développement Autonome (ADA), an NGO based in Luxembourg that supports microfinance institutions (MFIs) in low- and middle-income countries, recently entered into a contract with Luxembourg’s Directorate of Development Cooperation and Humanitarian Affairs with the goal of creating jobs and otherwise reducing
MICROCAPITAL BRIEF: Banque Misr Leads $85m Investment to Launch Global Ventures’ Nclude Fund for Financial Inclusion via Fintech in Egypt
Global Ventures, a UAE-based venture capital firm that invests primarily in the Middle East and Africa, recently founded Nclude, an investment fund specializing in financial technology (fintech), with the aim of boosting financial inclusion, primarily in Egypt. Part of the purpose of Nclude is to
MICROCAPITAL BRIEF: Impact Asset Management Loans $11m from Dual Return Microfinance Funds to MFIs in East Timor, Ecuador, Kosovo, Nicaragua
Impact Asset Management (I-AM), a member of the Austria-based C-Quadrat Investment Group, recently disbursed loans from Vision Microfinance and Vision Microfinance Local Currency, the two sub-funds of the Dual Return Fund family, that total the equivalent of
MICROCAPITAL BRIEF: SIG Venture Capital Leads $210m Investment in Fintech Voyager of the Philippines
Voyager Innovations, a Philippine provider of digital financial services tools such as Fintq, PayMaya and Smart Padala, recently secured an investment package totaling USD 210 million. The fresh capital is slated for developing the company’s “digital banking venture and other services like cryptocurrency and micro-investments.” Voyager was established in