by Lori Curtis -

MICROCAPITAL STORY: New Insights Into The Impact of The Global Credit Crisis Envisage A Slow in Growth for Microfinance According to Reuters, World Bank, ACCION and YES Bank

Two stories on how the global financial crisis will impact microfinance were released this week, by Reuters and the World Bank. These reports are only the latest in a slew of reports and analyses on how microfinance will be impacted by the credit crisis, ranging from extremely cautious pessimism to undaunted optimism. While these new reports remain mostly speculative, with little documented evidence of actual changes, they offer fresh insights by experts in the microfinance industry into whether any impacts have been experienced a few months into the credit crisis. As there have been a myriad of articles on the topic, this article highlights the unique or new information addressed in the two reports, with a list of past articles on the topic listed in the Additional Reading section below for further information.

by Scott Everett -

MICROCAPITAL STORY: John Deere Foundation Grants $1.2 Million to Opportunity International to Fight Hunger in Africa

Opportunity International, one of the world’s largest microfinance organizations, received a $1.2 million grant from the John Deere Foundation to provide increased access to financing for the hunger-afflicted in Africa. OI forecasts that the grant will have a $10.6 million economic impact over the next three years. The grant will be used to benefit farmers, food processors and retailers and their ability to provide affordable food to the rural poor in Malawi and Mozambique.

by Lori Curtis -

MICROCAPITAL STORY: Indonesia’s MBK Ventura, Egypt’s Al Tadamun, and Grameen Bank’s Nurjahan Begum Recognized at Grameen Foundation 2008 Awards

The achievements of the Grameen Bank‘s Nurjahan Begum, Indonesia’s Mitra Bisnis Keluarga (MBK) Ventura, and Egypt’s Al Tadamun were recognized on November 12, 2008 at the Grameen Foundation’s 2008 Awards in Washington D.C. The awards were held in conjunction with its annual Knowledge Sharing Roundtable discussion, which this year discussed the implications of the global financial crisis on microfinance. Nurjahan Begum received the Susan M. Davis Lifetime Achievement Award for her work in microfinance for over 30 years, including her efforts to organize women in Bangladesh’s poorest villages and leading the fight for the rights of disadvantaged women. MBK Ventura of Indonesia received the Excellence in Microfinance Award for its leadership its efforts to ensure that Indonesia’s poorest citizens receive financial services, and Al Tadamun of Egypt was awarded the Pioneer in Microfinance Award in recognition of its program to provide financial services to Cairo’s poorest women.

by Jeffrey Erfe -

PIONEERS IN MICROFINANCE: Six Pioneers in Latin America: Álvaro Dávila of Colombia, Joseph Blatchford of the USA, Theodore C. Ning, Jr. of the USA, Mercedes Canalda de Beras-Goico of the Dominican Republic, Clara Serra de Akerman of Colombia, and José Ignacio Avalos Hernánde of Mexico

Microcapital has identified the following six microfinance “pioneers,” individuals who have made long-standing contributions to the evolution and promotion of microfinance practices and/or technology. While not all of these pioneers hail from Latin America, all have been instrumental to the development of microfinance in that region. These pioneers are: Álvaro Dávila of Colombia, Joseph Blatchford of the USA, Theodore C. Ning, Jr. of the USA, Mercedes Canalda de Beras-Goico of the Dominican Republic, Clara Serra de Akerman of Colombia, and José Ignacio Avalos Hernánde of Mexico. Below are short descriptons of the contributions of each:

by Iyanna Holmes -

MICROCAPITAL STORY: Vikram Akula to step down as CEO of SKS Microfinance

Vikram Akula, founder of SKS Microfinance (SKS ), has announced plans to step down from the role of CEO after 10 years.  Mr. Akula says that this change will allow him to focus on a new initiative – microinsurance.  As MicroCapital reported earlier this year, SKS partnered with Bajaj Allianz Life Insurance Company to offer insurance products toclients.  This announcement comes amid rapid growth in the company. Suresh Gurumani, Director, Barclays Bank, will take over as SKS Microfinance’s CEO.  An official transition date was not given.  

by Scott Everett -

MICROCAPITAL STORY: USAID Note from The Field, Greening Microfinance to Turn Waste Into Wealth

United States Agency for International Development (USAID) recently published a note about efforts in India to provide an integrated approach in addressing poverty alleviation, global health and energy. Shortage of cooking fuel is a key problem in India where approximately 260 million of the country’s total 1.2 billion population live below the poverty line. Some households burn cow dung cakes as an alternative fuel source, creating environmental hazards and causing harmful health consequences, including acute respiratory infections in children. According to a 2006 Shell Foundation Report, deaths linked to biomass smoke exposure compete with malaria as the leading cause of death in adults in developing nations every year.

by Iyanna Holmes -

MICROCAPITAL STORY: SKS Microfinance Raises $75.4m in Equity Capital in Transaction Led by Sandstone Capital

SKS Microfinance Pvt. Ltd. has announced the closing of a fourth round of equity financing in which it raised Rs 366 crore, approximately USD 75.4 million.  The transaction was led by Sandstone Capital, a U.S. hedge fund based in Boston, MA.  Also participating in the transaction were existing investors Kismet Capital and SVB India Capital Partners, an affiliate of Silicon Valley Bank.  Edelweiss Capital was the investment banker to the issue.

by Jeffrey Erfe -

MICROCAPITAL EVENT: Microfinance and Climate Change: Can Microfinance Institutions (MFIs) Promote Environmental Sustainability?

NOVEMBER 18 TO NOVEMBER 20, 2008, INTERNET FORUM BY MICROLINKS

Over the course of three days, MicroLinks will host a “Speaker’s Corner” entitled “Microfinance and Climate Change: Can Microfinance Institutions (MFIs) Promote Environmental Sustainability?”  Speaker’s Corner events are online conferences or forums for the purpose of engaging current microenterprise and microfinance issues.  This forum will be hosted by Dan Lundmark, a documentary producer and director currently working on a film highlighting the environmental policies and impacts of MFIs and microenterprises in Latin America, Africa, and Asia.  Several panelists will join the forum from GreenMicrofinance: Joan Hall, Elizabeth Israel, Thomas Israel, Kathleen Robbins, Betsy Teutsch, and Bela Vora.  Panelists from Indian MFIs will include Manab Chakraborty from MIMO Finance, Paul Moonjely from Wesco Credit, and Paul Thomas from the Evangelical Social Action Forum (ESAF).

by Jeffrey Erfe -

MICROCAPITAL STORY: Thirty-Five Organizations Sign Client Protection Principles to Ensure Fair Treatment and Financial Protection of Low-Income Microfinance Clients

In late October, 35 microfinance institutions (MFIs) and investment funds signed the Client Protection Principles (CPP), a list of pro-consumer principles and mandates that aims to become an industry-wide standard for ensuring the fair treatment and financial protection of low-income microfinance clients.  The CPP are part of a larger campaign launched in September of 2008 at the annual meeting of the Clinton Global Initiative, a conglomeration of governments and public and private organizations dedicated to sustainable development, with the goal of incorporating at least half of the world’s 500 largest MFIs within the next three years. According to Consultative Group to Assist the Poor (CGAP), there is little evidence of client abuse in the microfinance sector.  

by Iyanna Holmes -

MICROCAPITAL STORY: International Business and Finance Network (IBF Net) and Islamic Relief Worldwide Host an Islamic Microfinance Training Program

The Islamic Business and Finance Network (IBF Net), a global network of students, researchers, and finance professionals, and its Institute of Microfinance and Development together with Islamic Relief Worldwide, an international development and relief organization, held an international training program and workshop to discuss the nuances of Islamic microfinance was recently held in New Delhi.    The program was attended by over sixty participants from the corporate sector, NGOs, and academics from India, Bangladesh, Sri Lanka and Afghanistan.

by Jeffrey Erfe -

MICROCAPITAL EXCERPT: Using Microfinance to Fight Malaria with Bednets, by Michael Chasnow

Posted by Michael Chasnow at 10:10pm on Wednesday, October 22, 2008, available at: http://www.indiadevelopmentblog.com/

The following piece is a summary of a health-focused microfinance project in Orissa, India, organized by professors from Duke and Stanford and the Bharat Integrated Social Welfare Agency (BISWA, an Indian non-governmental organization (NGO) started in 1994 that focuses on sustainable development). The project involves providing insecticide treated bednets (ITNs) to low-income households in a malaria-infested region of Western Orissa, India. Michael Chasnow has visited Orissa and summarizes and comments on the project below:

by Jeffrey Erfe -

MICROCAPITAL PAPER WRAP-UP: Islamic Microfinance: An Emerging Market Niche, by Nimrah Karim, Michael Tarazi and Xavier Reille

Written by Nimrah Karim, Michael Tarazi and Xavier Reille and based primarily on secondary research by the Consultative Group to Assist the Poor (CGAP), released in August 2008 as Number 49 of Focus Note, a publication of CGAP, 16 pages, available on October 27, 2008 at: http://www2.cgap.org/gm/document-1.9.5029/FocusNote_49.pdf.

by Iyanna Holmes -

MICROCAPITAL STORY: Freedom From Hunger Experiments With Discounted Health Care to Microcredit Borrowers to Drive Lower Default Rates

Healthy borrowers repay loans.  That is the theory underlying Freedom From Hunger’s Microfinance and Health Protection Program.  Freedom From Hunger, an international development organization that is funded by a USD 5.6 million grant from the Bill and Melinda Gates Foundation, is taking a creative approach to reducing borrower default rates.  The company has found that when loans are not repaid, health care needs are often a principal reason.  Borrowers will use loan proceeds to pay for health care needs instead of for investing in their businesses.  In 2007, the Microfinance and Health Protection Program began offering borrowers discounted doctor visits, health care savings accounts, affordable medicine, and emergency health care loans in order to combat this problem.