by Andrea Chu -

MICROCAPITAL STORY: Microfinance Information Exchange (MIX) Announces Release of the Social Performance Task Force’s (SPTF) Social Performance Indicators Survey

The Microfinance Information Exchange (MIX), the microfinance information clearinghouse, has sent a questionnaire to over 1,300 microfinance institutions (MFIs) throughout Asia, Eastern Europe, Africa and Latin America in an attempt to develop a standardized measurement of social performance. Designed to evaluate social performance, the survey consists of 22 core indicators covering topics such as client poverty level, progress out of poverty, product design, and institutional policies and procedures.

by Ryan Hogarth -

MICROCAPITAL STORY: Pakistani Microfinance Institutions Charged with Deceiving Borrowers

Pakistani Microfinance Institutions (MFIs) found themselves in heavy criticism at a workshop on the state of microfinance held in Islamabad.  The workshop was organized by the Planning Commission of the Government of Pakistan to revisit the policies in place for MFIs and determine recommendations for the future of the industry.  

by Bharathi Ram -

MICROCAPITAL STORY: International Finance Corporation (IFC) Provides Loan worth EUR 7 million to Microcredit Foundation EKI (MCF EKI) to Expand Financial Services in Bosnia and Herzegovina

The International Finance Corporation (IFC), the private sector lending arm of the World Bank, is providing a loan worth EUR 7 million to the Microcredit Foundation EKI (MCF EKI), a microfinance institution (MFI) based in Bosnia and Herzegovina (BiH). According to a press release on the IFC website, this loan is issued to enable MCF EKI to expand its outreach to micro-entrepreneurs in the rural areas of the BiH region and will be used in part to finance micro-entrepreneurs and the rest to finance home-improvement projects in several of the region’s war ravaged areas. In this regard, EKI’s micro-lending program, which targets micro and small enterprises in the region, aims to utilize IFC’s support to disburse 4,200 new loans to microentrepreuners by the end of 2011. Under its Housing Refurbishment Loan Program, EKI will use up to EUR 1 million of IFC’s loan to provide loans for repair and improvement of several houses in the BiH  region that were badly damaged by the Bosnian Civil War that took place between 1992 and 1995.

by Ryan Hogarth -

MICROFINANCE PAPER WRAP-UP: “microLINKS Connections, March 2009,” by USAID

The United States Agency for International Development (USAID) has released its March edition of microLINKS Connections. The monthly newsletter reports on the work of USAID and its partners in building microenterprises, summarizes research papers and resources on microfinance, and announces upcoming microfinance events. To subscribe to microLINKS Connects and for a complete version the March edition please refer to this link. Highlights from the March edition are as follows.

by Ryan Hogarth -

MICROFINANCE PAPER WRAP-UP: “A Study Analyzing the Effects of Fuel and Food Inflation on Microfinance Institutions and Borrowers,” by MF Analytics

Written by MF Analytics Ltd. (MFA) and published by the United States Agency for International Development (USAID), data is based on three case studies conducted by MFA in Nicaragua, Haiti and Bangladesh, released January 2009, 38 pages, full text available at: http://www.cgap.org/gm/document-1.9.7450/Impact_and_Implications_of_Food_Crisis.pdf

by Ryan Hogarth -

MICROCAPITAL STORY: Compartamos Announces 2008 Fourth Quarter Earnings Over Webcast

The Mexican microfinance bank, Banco Compartamos, announced its audited financial results for the fourth quarter of 2008 (4Q08) in a conference call. The figures were announced in pesos and have been converted here to US dollars. The figures adhere to the requirements of the Comision Nacional Bancaria y de Valores (CNBV), the Mexican banking and securities regulator. Compartamos underwent an Initial Public Offering (IPO) in April 2007, and has since been publicly traded on the Mexican Stock Exchange. The webcast is archived and can be accessed through this link. The 4Q08 Financial Statement is available for download here.

by Yanni Hao -

MICROFINANCE PAPER WRAP-UP: Microfinance Sector’s Consumer Protection Initiative, By Maheen Saleem and Aban Haq

Maheen Saleem and Aban Haq wrote an article entitled, “Microfinance Sector’s Consumer Protection Initiative,” published in the February issue of Business Recorder. The authors first summarize the rapid development of the microfinance industry in Pakistan. They then highlight how increasing competition in the microfinance industry can lead to the use of unethical and illegal practices by organizations in order to gain a competitive advantage. They contend that these facts, combined with the characteristic vulnerability of microfinance recipients, demonstrate the need for institutionalized consumer protection. Accordingly, Pakistan Microfinance Network (PMN), an association of professional organizations in the field, has laid out a set of guidelines and principles for the treatment of microfinance clients called the Code of Conduct for Consumer Protection. The Code was officially launched on the 26th of January, 2009. The full text of the article is available at:

http://www.brecorder.com/index.php?id=890801&currPageNo=1&query=&search=&term=&supDate=

by Bharathi Ram -

MICROCAPITAL STORY: The MasterCard Foundation in association with the Aga Khan Foundation Canada (AKFC) and CARE Canada to Invest USD 9m to Expand Savings Initiatives in Tajikistan and Rwanda

The MasterCard Foundation, an independent, private foundation based in Toronto, Canada has announced two new programs to expand savings initiatives in the countries of Tajikistan and Rwanda. According to a press release on PR Newswire, a total investment of USD 9 million will be made towards these programs aimed at strengthening and creating innovations within the Village Savings and Loan Association (VSLA) model. The program in Tajikistan will be in association with the non-profit, Aga Khan Foundation Canada (AKFC) whereas CARE Canada (an operational member of the private, international humanitarian organization CARE International) will be involved with the MasterCard Foundation for the Rwandan initiative. The electronic news and information portal, PR Newswire is headquartered in New York, USA and is a subsidiary of the London based global business media company United Business Media Plc.

by Ryan Hogarth -

MICROCAPITAL STORY: Grameen Foundation and Oikocredit Offer Progress out of Poverty Index as Cornerstone of Socially Motivated Microfinance Investment Guidelines

The Grameen Foundation, in collaboration with Oikocredit, has developed a set of guidelines to help ensure a social impact of investments in microfinance.  In a press release, the foundation stated that in 2006 over USD 663 million had been invested into microfinance by US-based investors, much of it by socially motivated investors looking for a “social return” as well as a financial return.  Measuring the size of the social return, however, has always proved more difficult than measuring its monetary counterpart. 

by Ryan Hogarth -

MICROFINANCE PAPER WRAP-UP: “Africa Microfinance Analysis and Benchmarking Report, 2008,” by Jennifer Isern and Estelle Lahaye of CGAP, and Audrey Linthorst of MIX

“Africa Microfinance Analysis and Benchmarking Report, 2008,” written by Jennifer Isern and Estelle Lahaye of the Consultative Group to Assist the Poor (CGAP), and Audrey Linthorst of the Microfinance Information Exchange (MIX), analyzes the development of the microfinance industry in Africa with a focus on key growth trends, the regulatory environments, funding flows and structure, and performance of microfinance institutions (MFIs). The report is based on data submitted from 160 African MFIs. In 2008, the 160 MFIs collectively reached 5.2 million borrowers with a total credit line of USD 2.5 billion, and 9 million savers with gross savings of USD 2.1 billion (p1). Full text of the article is 20 pages and is available here.

by Bharathi Ram -

MICROCAPITAL PAPER WRAP-UP: Can Microfinance Reduce Portfolio Volatility? by Nicolas Krauss and Ingo Walter

Written by Nicolas Krauss of the Department of Politics, New York University and Ingo Walter of the Stern School of Business, New York University, this paper analyzes the correlation between microfinance and international and domestic markets. Analyzing the sensitivity of microfinance institutions (MFIs) with global capital markets in terms of income and assets, the study discusses whether the correlation (or lack thereof) positions microfinance as a useful asset allocation technique for fund managers seeking portfolio efficiency and diversification. The 33 page document was published by New York University in January, 2008 and the full text of the report is available here.

by Bharathi Ram -

PAPER WRAP-UP: Performance and Corporate Governance in Microfinance Institutions (MFIs) by Roy Mersland and R. Oystein Strom

Written by Roy Mersland of Agder University and R. Oystein Strom of Ostfold University College, this report analyzes the relationship between firm performance and corporate governance in Microfinance Institutions (MFIs). It studies the effects of ownership type, competition and regulation using a global data set on MFIs, collected from third-party rating agencies. The 36 page document was published by the University Library of Munich, Germany in June 2007 and the full text of the report is available here.

by Bharathi Ram -

MICROCAPITAL STORY: International Symposium on Microfinance as a Tool for Peacebuilding Discusses Rebuilding the Social and Economic Fabric in Post-Conflict Areas of Colombia through Microcredit

The International Symposium on Microfinance as a Tool for Peacebuilding discussed how microcredit could be used to rebuild the economy and promote growth in post-conflict areas of Colombia. According to this press release on the Symbiotics website, the symposium which was held in the city of Cali in Colombia was attended by nearly 2000 participants. Symbiotics is a microfinance information, consulting and services organization based in Switzerland. The symposium was sponsored by the Alvaralice Foundation, a Colombian non-profit established in 2003 and dedicated to promoting peace and economic growth in the country.