by Radhika Chandrasekhar -

MICROCAPITAL.ORG BRIEF: Chinese Association of Microfinance (CAM) Calls for Microfinance Reform in Country

During the China Microfinance Summit Forum 2009, Secretary General of the China Association of Microfinance (CAM) Bai Chengyu, stated that microfinance institutions (MFIs) must refine their systems of assessing social impact by enforcing better regulations and decision-making processes. Mr. Bai argued that in order for domestic MFIs to truly cater to poverty alleviation, they should not require borrowers to provide collateral in exchange for loans. He cited data from the People’s Bank of China (PBC), which details that 87.1 percent of total loans issued by the end of 2008 were collateral loans, whereas 12.9 percent of total loans were non-collateral loans.

by Stefanie Rubin -

MEET THE BOSS: Interview with Andrew Kuper, President and Founder of LeapFrog Investments Ltd.

Dr. Andrew Kuper is President and Founder of LeapFrog, the world’s first microinsurance fund, which he founded in 2007. He was previously a Managing Director of Ashoka, a support organization for social entrepreneurs. He has worked with microfinance institutions Grameen and BRAC, and is the author of two books on globalization. He holds a PhD from Cambridge University in the United Kingdom.

by Kenny Kline -

MICROCAPITAL.ORG STORY: USAID Launches Partnership With Grameen Foundation With $162.5m Credit Guarantee

The U.S. Agency for International Development (USAID) and Grameen Foundation announced a new private-public partnership to support local currency financing to microfinance institutions (MFIs) throughout the developing world. To launch the partnership, the two parties signed a Memorandum of Understanding to formalize the agreement, and entered into a USD 162.5 million join guarantee agreement aimed to help MFIs gain greater access to financing. The twelve-year program is the largest credit guarantee to date under USAID’s Development Credit Authority, and also marks the first time that a non-governmental organization will serve as the facilitator. Grameen Foundation will manage the credit risk of the pool and vet the microfinance institutions who would like to access the funding, while both organizations will issue joint guarantees together. [1]

by Stefanie Rubin -

MICROCAPITAL.ORG STORY: Abu Dhabi Fund for Development (ADFD) and Grameen Trust (GT) of Bangladesh Sign Memorandum of Understanding Aimed to Alleviate Poverty in Bangladesh and Other Developing Countries

The Abu Dhabi Fund for Development (ADFD), a national institution under the Abu Dhabi Government, has signed a Memorandum of Understanding (MoU) with Grameen Trust of Bangladesh, an NGO established by Nobel Laureate Professor Muhammad Yunus in 1989. The MoU, signed by Dr. Yunus and Ms. Al Mubarak, member of the ADFD Board and Director of the Loans and Equities Department, aims at defining cooperation between the two organizations for the purpose of alleviating poverty in Bangladesh and other developing countries. Specific details regarding the partnership have not been released [1, 2, 3].

by Stefanie Rubin -

MICROCAPITAL.ORG STORY: SKS Microfinance Plans for India’s First Microfinance Institution’s (MFI) Initial Public Offering (IPO), Managed by Citigroup, Credit Suisse and Kotak Mahindra Capital

According to an article in the Financial Times, Hyderabad-based SKS Microfinance, India´s largest microfinance institution (MFI), is taking steps toward becoming the first microfinance institution (MFI) to be listed on Indian stock exchanges. The initial public offering (IPO) could come as early as the start of 2010. Investment firms Citigroup, Credit Suisse and Indian-based Kotak Mahindra Capital will manage the USD 200 to 250 million listing [1].

by Stefanie Rubin -

MICROCAPITAL.ORG STORY: Grameenphone (GP) of Bangladesh Closes Subscription for Country’s Largest IPO of $70.4m

Grameenphone (GP), the largest provider of cell phone service in Bangladesh with over 20 million customers, has closed the subscription for an Initial Public Offering (IPO) expected to take place on the Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) this November. The subscription was “apparently hugely oversubscribed as long queues of aspirants were seen at the banks, even on the last day” [1]. Officials have not said how many times it has been oversubscribed.

by Christopher Maggio -

MICROCAPITAL.ORG PAPER WRAP-UP: Acute Poverty Alleviation Through Women’s Targeting by Micro nance Programs, by Alexandra Dobra

Written by Alexandra Dobra, published in March 2009 by the Munich Personal RePEc Archive, 8 pages, available at: http://mpra.ub.uni-muenchen.de/16874/1/MPRA_paper_16874.pdf

This paper, by Alexandra Dobra of the University of York Department of Politics, is a literature review that attempts to address the merits of female-targeted microfinance [1]. In addition to microfinance, Ms. Dobra has also done research on immigration in developed countries [1,2]. The paper is published by the Munich Personal RePEc Archive, an archive that houses economics papers for authors who want their work to be freely available [3].

by Chinq Yee Chong -

MICROCAPITAL.ORG STORY: International Banking Systems Online Journal Publishes Supplement On The Role of Technology In Microfinance And Highlights Importance Of Risk Management Systems

The International Banking Systems publication (IBS), an online journal that provides information on banking systems and operations, have produced a detailed supplement on the role of technological systems in microfinance [1]. An article within the supplement entitled ‘Technology for Microfinance – Trends driving the technology’ [2], the authors discuss the growing importance of risk management systems in MFIs. These systems are significant as they allow MFIs to address critical issues such as over-indebtedness, a problem which has become acute for some MFIs in the current financial turmoil, and report to their investors promptly.

by Christopher Maggio -

MICROCAPITAL.ORG STORY: Mexican Business Tycoon Carlos Slim Helú’s Carlos Slim Foundation and Grameen Trust Launch “Grameen-Carso”, Mexican Micro-Lending Program With USD 5 Million Donation and USD 40 Million Guaranteed as Credit Line

Mexican entrepreneur Carlos Slim Helú (Carlos Slim), through his charitable Carlos Slim Foundation, has teamed with Grameen Trust, an organization charged with supporting and promoting poverty-alleviating activities, to begin “Grameen-Carso” a micro-lending program in Mexico started with a Carlos Slim Foundation donation of USD 5 million for initial assets, and a guaranteed USD 40 million from the Carlos Slim Foundation as a credit line [3]. The terms and conditions of this credit line have not been disclosed. Grameen Trust will assume a management role for the program, bringing in experienced employees in the field of microfinance from Grameen Bank, the microfinance institution (MFI) whose model Grameen Trust attempts to promote in its ventures [1,3]. The managers will then, in the long term, “capacitate local managers in order to be in charge of procedures in Mexico” [3].

by Stefanie Rubin -

MICROCAPITAL.ORG STORY: Grameen Trust of Bangladesh Partners with Alibaba Group to Create Grameen China, With Initial Focus on Bringing Microfinance to Sichuan Province

Grameen Trust of Bangladesh, an NGO established by Nobel Laureate Professor Muhammad Yunus in 1989, has teamed up with Alibaba Group, China’s largest online business-to-business trading site which hosts over 42 million users from more than 240 countries, to create Grameen China [1, 2, 3].  Alibaba, which had an IPO of USD 1.7 billion on the HKSE in 2007, has kicked-off the initiative with a USD 5 million charitable donation.  Grameen China will initially focus on providing financial services to people living in Inner Mongolia and Sichuan Province, which is still recovering from the May 2008 earthquake that killed over 70,000 people and left nearly 10 million homeless [4].