Fusion Microfinance, a microfinance institution in India, recently borrowed EUR 10 million (USD 12.2 million) from Bank im Bistum Essen (BIB), a cooperative bank based in Germany. The loan proceeds are intended for Fusion Microfinance to “on-lend to women borrowers from low-income households, increasing their access to finance.” The deal was facilitated by Northern Arc Capital, a non-banking financial company in India that is dedicated to financial inclusion.
Markus Christ, a senior investment officer at BIB, said of the deal, “We believe that especially in these turbulent times it is more important than ever to show a strong commitment and support to the underprivileged women entrepreneurs active in the rural areas of the country.” The loan is BIB’s first in India.
Founded in 2010, Fusion loans to joint-liability groups of women, seeking to minimize over-indebtedness by training employees and prospective borrowers on the risks and responsibilities of borrowing. As of August 2020, the institution serves 1.8 million customers, all living in rural and semi-urban areas, via approximately 591 branches in 18 states. It has a gross loan portfolio of INR 36 billion (USD 496 million) and total assets of INR 36.1 billion (USD 498 million) as of March 2020. The organization does not accept deposits.
Founded in 1966, BIB seeks to work in a manner that is sustainable and compatible with “Christian social teaching.” The bank reported total assets of EUR 5.27 billion (USD 6.42 billion) as of 2019. BIB has operated in microfinance for approximately ten years, with EUR 245 million (USD 298 million) invested in “self-managed microfinance funds,” serving approximately 700,000 people in 30 countries.
By Bradley Shulman, Research Associate
Sources and Additional Resources
Economic Times article
https://economictimes.indiatimes.com/small-biz/money/fusion-microfinance-raises-10-million-euro-in-debt-from-bib/articleshow/
Fusion Microfinance 2020 annual report
https://fusionmicrofinance.com/pdf/Annual_Report_R2019-20.pdf
BIB 2019 annual report
https://www.bibessen.de/content/dam/f0589-0/pdf-dokumente_intern/geschaeftsbericht/annual-report.pdf
Northern Arc Capital homepage
https://www.northernarc.com/
Previous MicroCapital article on Fusion Microfinance
https://www.microcapital.org/microcapital-brief-grameen-credit-agricole-foundation-ca-cib-loan-6-1m-to-fusion-microfinance-of-india/
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