by Greg Casey -

MICROCAPITAL STORY: A Little World (ALW) of India Closes Series of Financing Totaling $6.3m from Investors including the Bellwether Microfinance Fund, the India Financial Inclusion Fund and Legatum Ventures

A Little World, a technology company based in Mumbia, India, recently finished a round of funding which brought in INR 287m (USD 6.3m). The investors included the Bellwether Microfinance Fund, the India Financial Inclusion Fund and Legatum Ventures. The investments, which were facilitated by Intellecap, are intended to help build ALW’s product portfolio. ALW focuses on using banking technologies to provide low cost financial services to those at the bottom of the economic period.

by Greg Casey -

WHO’S WHO IN MICROFINANCE: The Legatum Group

The Legatum Group, founded in 2006 from the de-merger of Sovereign Global, is a collection of investment organizations based in Dubai, United Arab Emirates. The separate companies comprising Legatum include Legatum Capital, a global investment firm; Legatum Global Development, a socially-responsible investment firm that also provides grants and policy advocacy services to promote sustainable development; the Legatum Center for Development and Entrepreneurship at MIT; and the Legatum Institute, which is an independent policy advisory firm.

by Greg Casey -

MICROCAPITAL STORY: Philip Vassiliou of Legatum Capital Publishes Editorial Supporting For-Profit Microfinance in The Economic Times

In a recent Economic Times editorial, Philip Vassiliou, managing director of Legatum Capital, an international investment firm, argues that, “to reach its full potential, the microfinance sector must embrace free market principles of competitive pricing and commercial incentives.” He also believes that “modifying these incentives, however noble the intention, will only damage the natural development of the sector.” His comments come at a time of fierce debate over the benefits of commercial microfinance.

by Ryan Benson -

MICROCAPITAL STORY: Bahraini Government to Seek Technical Assistance from Indian Microfinance Practitioners in Developing Microfinance Programs

The government of Bahrain plans to seek technical assistance from India’s microfinance sector in establishing future government-sponsored microfinance programs. Minster of Social Development Fatima Al Balooshi will lead a delegation to India next week to discuss technical assistance prospects with officials at various government and private institutions involved in India’s microfinance development. Institutions on the delegation’s itinerary include India’s NABARD (National Bank of Agricultural and Rural Development), an unnamed microfinance research institution, as well as various NGOs associated with microenterprise development.

by Ryan Benson -

MICROCAPITAL STORY: Consolidation of Indian Microfinance Institutions Expected

Experts following the growth of microfinance in India say that the sector is headed toward a phase of consolidation, and expect to witness a series of mergers and acquisitions. Originally reported by The Wall Street Journal’s Livemint, it is expected that consolidation will occur amongst smaller MFIs in order to compete with India’s microlending giants. Currently, the top 25 microlenders in the space account for 75 percent of total microlending, creating a strong imperative for small MFIs to join forces.  It is expected that MFIs serving less than 5000 clients will need to engage in consolidation.

by the MicroCapital Team -

MICROCAPITAL STORY: Microfinance Insights Publishes Webcast of Vodafone, FINO, IIT, BASIX Leaders on Microfinance Regulation, Mobile Banking, Technology & Financial Inclusion

Through August 3, a webcast is freely available of the July 3 Microfinance Insights panel titled: “Technology and Financial Inclusion: What Works? A Discussion about Microfinance, Regulation, M-banking, Technology & Financial Inclusion.” Speakers include:

– Vijay Mahajan, Founder, BASIX

– Rajesh Dongre, Head, Mobile Business Commerce, Vodafone India

– Ashok Jhunjhunwala, Professor, Indian Institute of Technology (IIT), Chennai

– Manish Khera, CEO, Financial Information Network & Operations (FINO)

The panel event was sponsored by FINO, a provider of technologies such as smart cards and biometric devices to financial institutions.

by Sarah Knapp -

MICROCAPITAL STORY: Microfinance Brokerage Sites Rangde.org and dhanaX.com Launch in India Following Kiva.org

Two new microlending sites, Rangde.org and dhanaX.com were launched this year to facilitate loans between social investors and low income borrowers in India. Initiated by U.S.-based kiva.org in 2005, micro-lending websites allow individual lenders to invest in individual borrowers via associated microfinance institutions (MFIs) that disperse the loans. These sites appear to be similar to “peer to peer” (p2p) lending sites such as US-based prosper.com, but in reality, are connecting individual borrowers and lenders through a third party (the MFI). Though Rangde and dhanaX also act as microfinance brokers, they are distinct from Kiva because they only allow investments by people with Indian bank accounts. MicroCapital has done extensive coverage on the development of kiva.org including coverage of Kiva’s launch, growth, and operations as a non-governmental organization (NGO).

by Ryan Benson -

MICROCAPITAL STORY: Unitus Launches $56m Microfinance Fund; Key Stakeholders Include Legatum, Omidyar Network

Seattle-based Unitus Equity Fund has raised USD 56 million that it plans to invest solely in commercial microfinance institutions throughout the world. Key stakeholders in the private equity fund include Legatum Group and Omidyar Network, each investing USD 20 million. The remaining USD 16 million was provided by an undisclosed source. Omidyar’s investment in the fund comes in the wake of an April 2008  MicroCapital report that Omidyar awarded a USD 9 million grant to Unitus, a nonprofit that is affiliated with the private equity fund. Omidyar’s grant supported Unitus’ three year expansion plan.

by Melissa Duscha -

PAPER WRAP-UP: Microfinance Insights: Human Resource Challenges and Solutions in Microfinance: Survey Report

This report is based on an online survey entitled “Human Resources Challenges and Solutions” conducted from February through March 2008 by Microfinance Insights magazine, a quarterly publication produced by Intellecap, an India-based program development and service provider for microfinance institutions. The Report was published in April 2008 as a 19-page document available here.

Microfinance Insights magazine ran an online survey on Human Resources Challenges and Solutions from February through March 2008. 90 respondents from 31 countries participated in the survey. The majority of the respondents (71 percent) were from microfinance institutions including rural banks, large financial firms, and microcredit-focused NGOs. The remaining respondents were from microfinance-focused consulting firms.

by Andrew Reese -

MICROCAPITAL STORY: 3RD Annual Srijan Microfinance Competition

The Srijan Microfinance Business Plan Competition will host its third annual entrepreneurial challenge. The name Srijan means “creation” in English and the competition aims at developing innovative solutions to the resource and infrastructure problems that currently limit MFI’s. In addition, the event hopes to capitalize on the entrepreneurial spirit of participants to further the efficiency of sustainable development methodologies and act as a forum for business, finance, and investor opportunities.

by Mary Fu -

MICROCAPITAL STORY: Engineers for Social Impact (E4SI) Launches New Fellowship Program in India for Engineers in Microfinance, Social Enterprises

Engineers for Social Impact (E4SI), a new fellowship program in India, has begun its recruitment process to match the top five undergraduate candidates from Indian engineering schools with five partner social enterprises that are focusing on development by means of sustainable for-profit entrepreneurship.