The International Finance Corporation (IFC), a member of the US-based World Bank Group that offers financial services to businesses and governments in developing countries with the aim of increasing economic growth, recently announced that it will loan USD 7 million to TuranBank Open Joint Stock Company (TuranBank), a retail and corporate bank in Azerbaijan.
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SPECIAL REPORT: Youth Are Less Risky Borrowers? European Microfinance Week Participants on Serving Young People via Leasing, Peer Education, Automatic Teller Machines (ATMs)
Countering the perception that youth are riskier borrowers than older clients, Maria Perdomo, the manager of the UN Capital Development Fund’s YouthStart program, recently presented data from seven African microfinance institutions (MFIs) showing that all but one have lower rates of portfolio at risk (PAR) within the segments of their portfolios serving youth than organization-wide. Nonetheless, she noted, youth often make up a disproportionately small share of an MFI’s customer base because loan officers believe they are less likely than others to repay, which would threaten the bonus that many loan officers receive when more of their clients do repay their loans.
MICROCAPITAL BRIEF: Grameen Crédit Agricole Microfinance Foundation Invests $788k in Oxus DR Congo, $321k in Uganda’s Encot
The Grameen Crédit Agricole Microfinance Foundation (GCAMF), a Luxembourg-based provider of financial services to microfinance institutions (MFIs) and other social businesses, recently informed MicroCapital that it has issued the following two loans:
SPECIAL REPORT: Over-indebtedness, Microfinance and Environment Award, Conflict Zones at e-MFP’s European Microfinance Week
MicroCapital: Please describe one of the key issues to be covered this year at European Microfinance Week.
Christoph Pausch: The question of over-indebtedness is still the major risk for the sector, as identified in the most recent Banana Skins survey. We had a very successful plenary last year exploring the issue from a research perspective. This year, we’re taking a very different approach by bringing CEOs of leading microfinance institutions (MFIs) from three countries – Bangladesh, Morocco, and Mexico – to discuss how they’ve been dealing with the issue. Each of these countries has had a different experience, with Bangladesh having successfully averted a potential crisis by slowing market growth (as described in an excellent paper by Stuart Rutherford and Greg Chen). Morocco was one of the original “microfinance crisis” countries during 2008 and 2009, and the MFIs there have had an interesting experience in resolving the problems from that period. Finally, Mexico is a major market with serious concerns regarding over-indebtedness, and MFIs there are working to avert a potential crisis.
MICROCAPITAL BRIEF: European Bank for Reconstruction (EBRD) Announces Potential $25m Risk-sharing Endeavor with Société Générale Serbia for Rural Microenterprise Financing Via VisionFund’s AgroInvest
The European Bank of Reconstruction and Development (EBRD), a multilateral institution headquartered in London, England, recently announced that it is likely to participate in a risk-sharing endeavor totaling RSD 2.3 billion (USD 25 million) with Société Générale Serbia, a subsidiary of the France-based financial institution Société Générale.
MICROCAPITAL BRIEF: European Bank for Reconstruction and Development (EBRD) Likely to Loan $150m in Jordan Including to Bank Al Etihad, Cairo Amman Bank for On-lending to Micro-, Small, Medium-Sized Enterprises (MSMEs)
The European Bank for Reconstruction and Development (EBRD), a multilateral institution headquartered in London, is considering setting up a senior unsecured credit facility in the amount of USD 150 million for banks in Jordan for on-lending to micro-, small and medium-sized enterprises (MSMEs).
MICROFINANCE EVENT: 6th Annual Toronto International Microfinance Summit: “Microfinance for Social Justice,” October 4, 2014, Allstream Centre, Toronto, Canada
Event Name: 6th Annual Toronto International Microfinance Summit: “Microfinance for Social Justice”
Event Date: October 4, 2014
Event Location: Allstream Centre, Toronto, Canada
MICROCAPITAL BRIEF: Absolute Portfolio Management’s Vision Microfinance Funds Loan $14m to Microfinance Institutions (MFIs) in Armenia, China, India, Peru, Tajikistan
Absolute Portfolio Management (APM), an arm of Austria-based asset group C-Quadrat, recently informed MicroCapital that it has distributed credits in several currencies that total approximately the equivalent of USD 13.5 million to unspecified microfinance institutions (MFIs) in Armenia, China, India, Peru and Tajikistan through its Dual Return Fund-Vision Microfinance and Dual Return Fund-Vision Microfinance Local Currency.
MICROCAPITAL BRIEF: “Harry Potter” Cinema Actress Emma Watson to Serve as Goodwill Ambassador for United Nations (UN) Women
United Nations (UN) Women, the UN organization “dedicated to gender equality and the empowerment of women,” has announced Emma Watson, a British actress, will serve as Goodwill Ambassador for the organization.
MICROCAPITAL BRIEF: Citigroup, Overseas Private Investment Corporation (OPIC) Jointly Loan $10m to Microfinance Institution (MFI) ACBA Credit Agricole Bank of Armenia
Citigroup, a financial services corporation based in the US city of New York, and Overseas Private Investment Corporation (OPIC), a government-backed development finance institution based in Washington DC, recently announced that they will partner to fund two jointly funded loans with a total value of USD 10 million for ACBA Credit Agricole Bank (formerly known as the Agricultural Cooperative Bank of Armenia), a Yerevan-based microfinance institution (MFI) that specializes in the financing of the agriculture sector of Armenia.
MICROFINANCE PUBLICATION WRAP-UP: “FinDev Azerbaijan: Retaining Key Staff Through a ‘Pay for Performance’ Culture;” by Sevda Huseynova, Jalal Aliyev, Kinga Dabrowska; published by Microfinance Centre
“FinDev Azerbaijan: Retaining Key Staff Through a ‘Pay for Performance’ Culture;” by Sevda Huseynova, Jalal Aliyev and Kinga Dabrowska; published by the Microfinance Centre; March 2014; 7 pages; available at http://www.mfc.org.pl/sites/mfc.org.pl/files/FinDev_SP_Fund_ENG.pdf
The authors of this paper describe Finance for Development Limited Liability Company (LLC) (FinDev), an Azerbaijan-based institution that offers economic opportunities for poor people, particularly the evolution of its “staff performance appraisal system and salary compensation scheme.”
MICROCAPITAL BRIEF: Absolute Portfolio Management’s Vision Microfinance Funds Loan $9.4m to Microfinance Institutions (MFIs) in Armenia, India, Kazakhstan, Kyrgyzstan, Mongolia, Peru, Sri Lanka, Tanzania
Absolute Portfolio Management (APM), an arm of Austria-based asset group C-Quadrat, recently informed MicroCapital that it has distributed credits worth approximately USD 9.4 million through its two Vision Microfinance funds to unspecified microfinance institutions (MFIs) in Armenia, India, Kazakhstan, Kyrgyzstan, Mongolia, Peru, Sri Lanka and Tanzania.
MICROCAPITAL BRIEF: Absolute Portfolio Management’s Vision Microfinance Funds Loan $5m to Microfinance Institutions (MFIs) in Azerbaijan, El Salvador, Tajikistan
Two funds controlled by Absolute Portfolio Management (APM), an arm of Austria-based asset group C-Quadrat, have distributed credits worth approximately USD 5 million to unspecified microfinance institutions (MFIs) in Azerbaijan, El Salvador and Tajikistan.
MICROFINANCE PUBLICATION ROUND-UP: Over-indebtedness in Mexico; Achieving Customer Centricity; Managing Over-indebtedness
“Over-Indebtedness in Mexico: Its Effect on Borrowers;” published by Microfinance CEO Working Group; May 2014; 32 pages; available at http://microfinanceceoworkinggroup.org/wp-content/uploads/2014/05/Over-Indebtedness-in-Mexico-Its-Effect-on-Borrowers-552014.pdf
This report cautions lending institutions in Mexico about rising levels of over-indebtedness – meaning more borrowers cannot reasonably repay their debts – which can threaten the financial system as well as the economic outlook of low-income individuals.
MICROFINANCE PUBLICATION ROUND-UP: Islamic Social Finance, Transforming Client Complaints into Loyalty, Microinsurance Profitability
“Islamic Social Finance Report 2014,” by Thomson Reuters and the Islamic Research and Training Institute, published by Zawya, 2014, 64 pages, available at: http://www.zawya.com/islamic-finance/isfr/
This report examines opportunities and challenges for Islamic social finance in Bangladesh, Brunei Darussalam, India, Indonesia, Malaysia, Pakistan and Singapore.
MICROCAPITAL BRIEF: International Finance Corporation, Microfinance Center of Poland Hire Cultural Consultant in Financial Literacy in Azerbaijan
The International Finance Corporation (IFC), the private-investment arm of the US-based World Bank Group, recently announced a partnership with the Microfinance Center (MFC) for Central and Eastern Europe and the New Independent States, a 110-member network based in Poland, to attempt to improve financial literacy in Azerbaijan.
MICROCAPITAL BRIEF: European Bank for Reconstruction and Development (EBRD) to Loan $69m to UniCredit Bank Serbia
The European Bank for Reconstruction and Development (EBRD), a UK-based multilateral institution, recently announced that it is considering loaning EUR 50 million (USD 69 million) to UniCredit Bank Serbia, a subsidiary of Italy-based financial services company UniCredit Group.
MICROCAPITAL BRIEF: European Bank for Reconstruction and Development (EBRD) to Loan $6.9m to Elana Agrocredit of Bulgaria to Expand Land Lease Financing
The European Bank for Reconstruction and Development (EBRD), a UK-based multilateral development bank, recently announced that it will extend a loan of EUR 5 million (USD 6.9 million) to Elana Agrocredit, a Bulgaria-based financial institution that provides lease financing to agricultural producers for farmland purchases.