The International Fund for Agriculture and Development (IFAD), an agency of the United Nations, has allocated a total of USD 8 million – equal parts equity and debt investment – to Al-Amal Microfinance Bank, a microfinance bank established by the Yemeni government in 2002. Yukiko Omura, the vice-president of IFAD, commented on the “importance of partnership between the Fund and the bank to enable the Fund to reach the poor people in rural areas to provide loans to small farmers, fishermen and other groups with low incomes.”
MICROCAPITAL BRIEF: G20’s Financial Inclusion Experts Group (FIEG) Releases Nine “Principles for Innovative Financial Inclusion” at Leadership Summit in Toronto, Canada
The Financial Inclusion Experts Group (FIEG), a division of the G20 – a group of twenty finance ministers and central bank governors that discuss key issues in the global economy – released nine “Principles for Innovative Financial Inclusion” at the recent G20 leadership summit in Toronto. The principles are intended to form the basis of a concrete action plan for improving access to financial services for the poor, which will be released at the Seoul Summit in November.
MICROCAPITAL BRIEF: responsAbility Global Microfinance Fund and responsAbility Mikrofinanz-Fonds Commit $3.3m to Microfinance Institutions Agricultural Cooperative Bank of Armenia (ACBA) Credit Agricole Bank and Nor Horizon Universal Credit Organization (UCO) Limited Liability Company (LLC) of Armenia
responsAbility, a Swiss-based microfinance investment vehicle (MIV) manager, recently reported to MicroCapital that it has executed debt investments totaling USD 3.3 million in two microfinance institutions (MFIs) in Armenia. Agricultural Cooperative Bank of Armenia (ACBA) Credit Agricole Bank, a microfinance bank that is partially held by Credit Agricole of France, will receive USD 1 million from responsAbility Mikrofinanz-Fonds and USD 2 million from the responsAbility Global Microfinance Fund. Nor Horizon United Credit Organization (UCO) Limited Liability Company (LLC), a regulated MFI, will receive USD 300,000 from responsAbility Global Microfinance. The investment funds are two of four funds operated by responsAbility, the others being responsAbility Base of the Pyramid and responsAbility Microfinance Leaders.
MICROCAPITAL BRIEF: Microfinance Expansion Suggests Increased Default Risks Says Financial Times
As part of its ‘BeyondBrics’ publication on business markets in emerging countries, the Financial Times (FT), a business news organization based in London, England, has predicted increased default risks in microfinance institutions (MFIs). James Fontanella-Khan, an online editor for FT, states, “Microfinance is expanding fast in emerging countries. The number of financial institutions piling in to grab a slice of the market is expanding at an even faster rate.”
MICROCAPITAL BRIEF: responsAbility Global Microfinance Fund and responsAbility Mikrofinanz-Fonds Disburse $2.5m to Bank Constanta and Credo, Microfinance Institutions in Georgia
responsAbility, a Swiss-based microfinance investment vehicle (MIV) manager, recently reported to MicroCapital that it has executed debt investments totaling USD 2.5 million in two microfinance institutions (MFIs) in Georgia. Joint Stock Company (JSC) Bank Constanta, a microfinance bank in Georgia, will receive USD 375,000 from responsAbility Mikrofinanz-Fonds and USD 1.25 million from the responsAbility Global Microfinance Fund. Limited Liability Company (LLC) Microfiance Organization (MFO) Credo, a non-bank financial institution, will receive USD 400,000 from responsAbility Mikrofinanz-Fonds and USD 600,000 from responsAbility Global Microfinance Fund. The investment funds are two of four funds operated by responsAbility, the others being responsAbility Base of the Pyramid and responsAbility Microfinance Leaders.
MICROCAPITAL BRIEF: UN Attempts to Alleviate Food Crisis, Expands Agriculture Inventory Credit System in Niger and Elsewhere in West Africa
The UN (United Nations) Food and Agriculture Organization (FAO) is implementing nine projects worth almost USD 18 million in Niger to support farmers experiencing prolonged drought in West Africa.
MICROCAPITAL BRIEF: Mayibuye Group Reveals Turnaround Strategy for Blue Financial Services, a South African Microfinance Institution with Presence in 14 Countries
Blue Financial Services, a South African microfinance institution, has entered into an agreement with Mayibuye Group (Pty) Ltd, a South African investment company, to provide ZAR 450 million (USD 58.6 million) in equity and debt financing.
MICROCAPITAL BRIEF: Populist Governments Propose Interest Rate Caps and Other Public Interventions on Latin American Microfinance Institutions
Populist governments in Latin America are attempting to favor microborrowers by proposing interest rate caps and other public interventions, as is described in a recent article written by Ms Elisabeth Rhyne, managing director of the Center for Financial Inclusion at ACCION International, and published in the Huffington Post. [1]
MICROCAPITAL BRIEF: Gallup Poll of Sub-Saharan African Respondents Indicates Family as a More Likely Source of Business Loans Than Microfinance Institutions
A recent Gallup poll of adults living in 18 sub-Saharan African countries indicates that 42 percent of those surveyed would obtain a business loan from a family member.
MICROCAPITAL BRIEF: International Finance Corporation (IFC) Invests $30.5m in Green for Growth Fund, SMEs To Benefit
The International Finance Corporation, a member of the World Bank Group, will reportedly invest EUR 25 million (equivalent to USD 30.5 million) in the Green for Growth Fund, Southeast Europe (GGF), a fund founded in December 2009 that “provides refinancing to financial institutions for on-lending to small and medium-sized enterprises (SMEs) and private households for financing energy efficiency projects.”
MICROCAPITAL BRIEF: Vishwavir Ahuja Joins Board of Ratnakar Bank, a Commercial Bank in Kolhapur, India
Vishwavir Ahuja, the former CEO of the Indian division of Bank of America, has joined the board of Ratnakar Bank, a community bank based in rural Kolhapur, as an independent director. According to Mr Ahuja, he hopes to transform the “relatively-unknown rural bank into a major player with a focus on inclusive growth.” Some have speculated that Mr Ahuja’s position on the board will lead to a greater influx of funding through unspecified “connections” with investors at Mumbai-based Centrum, a financial services firm established in 1977.
MICROCAPITAL BRIEF: responsAbility Global Microfinance Fund Disburses $2.5m to AgroInvest in Montenegro
The responsAbility Global Microfinance Fund, a microfinance investment vehicle (MIV) founded in 2003, recently reported to MicroCapital that it has provided debt financing totaling USD 2.5 million to AgroInvest Holding of Montenegro.
MICROCAPITAL BRIEF: European Bank for Reconstruction and Development (EBRD) Syndicates $185m Debt Facility for Turkey, Primarily for Microfinance, SMEs
The European Bank for Reconstruction and Development (EBRD), a London-based international finance institution, committed a debt facility of up to TRY 292 million (USD 185 million equivalent) to Turkish banks for lending to private companies, primarily micro-, small and medium-sized enterprises (SMEs), agricultural businesses and women entrepreneurs.
MICROCAPITAL BRIEF: Grameen Capital India Appoints Sanjay Nayar as New Director
Sanjay Nayar, the CEO of Kohlberg Kravis Roberts & Co (KKR) – a global alternative assets manager – has been named to the board of directors of Grameen Capital India, a Mumbai-based social business that promotes growth in the microfinance sector in India. Prior to joining KKR, Mr Nayar was the CEO of Citigroup India and South Asia.
MICROCAPITAL BRIEF: Microfinance Institutions (MFIs) in Nigeria Demand Direct Access to ‘Meso’ Credit Scheme from the National Poverty Eradication Programme (NAPEP)
Microfinance institutions (MFIs) in Nigeria want to bypass commercial banks to access government money in the form of a ‘meso’ credit scheme designed by the National Poverty Eradication Programme (NAPEP) – a government agency responsible for coordinating and monitoring all poverty eradication activities nationwide – to provide loans of between NGN 500,000 (USD 3,300) and NGN 50 million (USD 331,000) for agricultural processing in rural areas. The current regulations mandate that the meso credit funds be distributed to commercial banks for on-lending to qualified microfinance banks at “competitive rates.”
MICROCAPITAL BRIEF: Mimoza Enterprises Finance (Mimo) Receives $1.5m Loan from Unitus Incorporated, US Overseas Private Investment Corporation (OPIC) and Citi Microfinance
Mimoza Enterprises Finance (Mimo), an Indian microfinance institution (MFI) with a gross loan portfolio of USD 5.1 million, has received a loan of USD 1.5 million from Unitus Incorporated, an international nonprofit organization that provides funding and consulting services to microfinance institutions.
MICROCAPITAL BRIEF: International Finance Corporation (IFC) and IFC Capitalization Fund Agree to Invest $140m in Bank South Pacific (BSP) of Papua New Guinea to Extend Financial Services in Pacific Islands
The International Finance Corporation (IFC), a member of the World Bank Group, and the IFC Capitalization Fund, a USD 3 billion global equity and subordinated debt fund, have signed an agreement to invest USD 140 million in Bank South Pacific (BSP), one of the largest commercial banks in Papua New Guinea, in an effort to expand financial services across the Pacific Islands.
MICROCAPITAL BRIEF: Microfinance Information Exchange (MIX) and Global Impact Investing Network (GIIN) to Share Data With $187,000 Grant From Rockefeller Foundation
The Rockefeller Foundation, a US-based grantmaking organization, has awarded a USD 187,000 grant to two other US-based nonprofits, Microfinance Information Exchange (MIX) and the Global Impact Investing Network (GIIN), to “increase transparency and comparability across microfinance and the broader impact investing industry.” The grant will be used to develop a data feed that will allow GIIN’s Impact Reporting and Investment Standards (IRIS) project, which was created to develop a common framework for defining, tracking and reporting the performance of “impact capital,” to access data from MIX.