During 
one of the Friday sessions of European Microfinance Week 2020, Dina Pons of Belgium-based Incofin Investment Management explained a partnership with France-based food company Danone through which the organizations are building a 10-year equity fund to invest in expanding access to clean water in developing countries. Since 2007, the Danone Communities arm of Danone – mostly funded by its employees – has invested in access to drinking water on a proof-of-concept basis. Now Danone believes the sector has matured from the incubation stage to the investible stage. The company selected Incofin to help it invest in proven models, with a technical assistance component and monitoring of factors such as affordability, limiting plastic usage and
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SPECIAL REPORT: Minimizing Setbacks for Women, Girls Under COVID-19; Taking Advantage of the Pandemic to Liberalize Regulation, Boost Access to Digital Financial Services
Mary Ellen Iskenderian of the US-based NGO Women’s World Banking (WWB) spoke today, the closing day of European Microfinance Week, about the impact of the COVID-19 pandemic on women and girls. Of the challenges they face, she said “COVID didn’t create these gaps, but it shines a bright light on the fissures, and we don’t want to see these grow larger.” As an example, she cited the strides made in recent years in terms of enrolling girls in primary education. She called this the single most powerful tool for creating development impact. However, one of the first things she has seen families in developing countries doing in response to COVID-19 is taking their daughters out of school.
On the positive side, Ms Iskenderian noted “a silver lining, that
SPECIAL REPORT: Resilience Among Microfinance Institutions? “Region of Crisis” Relatively Stable; “Moratorium Veil” Yet to Lift
As part of the opening day of European Microfinance Week, Mohammed Khaled of the World Bank Group’s International Finance Corporation stated that the effects of the COVID-19 pandemic on the microfinance sector in the Middle East and North Africa (MENA) so far have not been as bad as was feared earlier in 2020. Most of the large microfinance institutions (MFIs) in the region have maintained 30-day portfolio-at-risk (PAR) ratios below 4 percent. Mr Khaled said, “Among leading MFIs, PAR did not rise as high as expected. We thought [it might rise to] 10 percent to 20 percent, but many MFIs have kept things under control.” Part of the reason for this, he believes is that “this is
SPECIAL REPORT: e-MFP Publishes Taking Shelter: Housing Finance for the World’s Poor
From the European Microfinance Platform (e-MFP): While the 2020 European Microfinance Award spotlights the importance of savings, e-MFP takes the opportunity to look back to the 2017 Award and revisit the importance of housing. Even more than savings, housing is one of those parts of microfinance that has been around for decades, yet which remains relegated to niche status. And yet, like savings, housing finance holds out the promise of real-world improvements for millions of poor households while simultaneously expanding the opportunities for financial service providers (FSPs).
That is why, in partnership with Practical Action Publishing, e-MFP is publishing its
SPECIAL REPORT: European Microfinance Week Action Group Meeting: Investors Not Incentivizing MFIs Sufficiently re Measuring Social Performance
During today’s opening sessions of European Microfinance Week, e-MFP’s Investor Action Group met to discuss social performance measurement within microfinance institutions (MFIs). Calum Scott of US-based NGO Opportunity International described his organization’s efforts to work with MFIs to measure client outcomes. He specified that Opportunity generally does not seek to measure client impact, as that has proven too resource-intensive for its purposes. However, he argued that, “The pandemic doesn’t make outcomes data less important. If anything it makes it more important to know if and how your products are helping clients.” Of Opportunity’s partners, 95 percent use
SPECIAL REPORT: European Microfinance Week Launches with Arguments for Client Protection, Community Approaches, Savings vs Credit, Biscuits vs Guns
European Microfinance Week 2020 launched today with Action Group meetings; opening remarks from Christophe Schiltz of Luxembourg’s Ministry of Foreign and European Affairs; and a keynote address by Ela Bhatt, the founder of India’s Self-Employed Women’s Association.
Mr Schiltz commented on the need for continued emphasis on client protection as the COVID-19 pandemic stresses both financial services providers (FSPs) and households. He also quoted from the European Microfinance Platform’s (e-MFP’s) COVID-19 Financial Inclusion Compass that the pandemic has created the opportunity to improve the financial inclusion sector in ways “that the gravitational pull of the status quo would never allow in more normal times.”
Ela Bhatt noted that her organization and others were focused on savings back in the 1970s before microcredit became
MICROCAPITAL BRIEF: CommBanane from Dimagi, SIDA, UNCDF Facilitates Digital Loans to Cooperatives of Banana Farmers from Baobab Sénégal
Dimagi, a US-based provider of technical assistance to development organizations, recently developed CommBanane, a digital platform providing financial solutions to small-scale banana farmers via cooperatives in Senegal. CommBanane serves as a “data tracking system” for agricultural production and can be accessed by farmers to apply for
MICROFINANCE PAPER WRAP-UP: “Consumer Protection and COVID-19: Borrower Risks as Economies Reopen,” by Elisabeth Rhyne, Published by CGAP
Dr Rhyne has analyzed data collected by CGAP, microfinance investors and financial service providers (FSPs) to consider how FSPs can collect outstanding microloans – including after repayment moratoria – and issue
MICROFINANCE PAPER WRAP-UP: “A COVID Perspective on Nepal Microfinance;” by Sanjay Sinha, Nara Hari Dhakal; Published by M-CRIL
This paper is intended to “enable international understanding of the finances of MFIs [microfinance institutions] in Nepal and the potential role of external lenders in supporting the ecosystem of the country.” According to Mr Sinha and Dr Dhakal, the COVID-19 pandemic has had less severe effects on the microfinance sector in Nepal than it has in countries such as India and Myanmar. This is partially because MFI customers in Nepal didn’t make significant withdrawals
MICROFINANCE PAPER WRAP-UP: “Digital Technology in Social Assistance Transfers for COVID-19 Relief: Lessons from Selected Cases;” by Alan Gelb, Anit Mukherjee; Published by Centre for Global Development
In this paper, the authors analyze the use of digital technology to implement government-to-person (G2P) social transfer programs in response to the COVID-19 pandemic in Brazil, Colombia, India, Namibia, Pakistan, South Africa and Togo. The analysis is organized around the following steps in the process:
MICROFINANCE PAPER WRAP-UP: “Has the Pandemic Spared Cambodia? Liquidity Considerations of Cambodia’s Large MFIs,” by Sanjay Sinha, Published by M-CRIL
The purpose of this paper is “to enable understanding of the finances of [microfinance institutions] in Cambodia and the potential role and expectations of investors in supporting the microfinance ecosystem of the country.” While other sources have sounded alarms
MICROCAPITAL BRIEF: Greenlight Planet Secures $90m in Debt, Equity for Pay-as-you-go Solar in Africa, South Asia
Greenlight Planet, a for-profit social business with offices in Kenya, India and the US, recently secured USD 90 million in debt and equity to expand its sales of pay-as-you-go (PAYG) solar products. The investors are
MICROCAPITAL BRIEF: Code for Responsible Lending Assessment Tool to Incorporate Comprehensive Credit Reporting, Microfinance Institutions to Increase Frequency of Reports to Credit Bureaux
The Code for Responsible Lending (CRL), an initiative serving microlenders in India, recently began developing a new credit assessment tool for evaluating loan applications from low-income households. The tool is intended to help lenders “go beyond multiple/over lending limits and more systematically evaluate the low-income customer
MICROCAPITAL BRIEF: Business Correspondent Sub-K Impact Launching Digital Platform for Insurance, Investing, Microfinance Referrals with Support from Accion, Mastercard
Sub-K Impact Solutions, a subsidiary of India-based BASIX Social Enterprise Group, is releasing a digital platform called SARTHI (Seamless Advanced Resourceful Tech-driven Hybrid Interface) to facilitate access to insurance, microloans and investment services. SARTHI will place users in contact with financial services providers
MICROCAPITAL BRIEF: MoneyGram International, Airtel Africa to Offer Mobile Remittances
MoneyGram International, a US-based money-transfer company serving 200 countries, is partnering with Airtel Africa, a subsidiary of India-based telecommunications firm Bharti Airtel, to allow 19 million users of the Airtel Money service in 12 countries to receive MoneyGram remittances directly into their mobile wallets. These funds then can be withdrawn at Airtel Africa service locations
MICROCAPITAL BRIEF: MicroEnsure, STP, TonkaBI Merge into “MicroInsurance Company,” Leveraging Straight-through Processing, Artificial Intelligence to Expand Access
Seeking to expand access to microinsurance for both individuals and businesses, UK-based companies MicroEnsure and TonkaBI along with the US-based STP Group recently merged to form the MicroInsurance Company (MIC). The new firm describes itself as “the first global end-to-end digital micro insurance solution,” benefitting from the three firms’ “reinsurance capacity, in-country insurance licenses, world-class distribution and market-leading artificial intelligence functionality.” STP Group brings the new company its straight-through processing (STP) methodology, which
MICROCAPITAL BRIEF: IIV Mikrofinanzfonds Invests $720k in Premier Credit, Refinancing Microfinance Loans in Kenya
Premier Credit Limited, a member of the Kenya-based Premier Group of microfinance institutions (MFIs), recently sold a package of microloan receivables for USD 720,000 to IIV Mikrofinanzfonds, a fund managed by Germany-based Invest in Visions (IIV). The MFI will use the cash to continue its support of micro- and small-scale entrepreneurs in Kenya. Other units of the Premier Group operate
MICROCAPITAL BRIEF: IIV Mikrofinanzfonds Reports Losses Under 3%; Invests $3.4m Refinancing Microfinance Institutions in Mexico, Tajikistan
Microfinance institutions in Mexico and Tajikistan recently sold packages of non-securitized loan claims for MXN 61.3 million (USD 2.66 million) and USD 750,000 and to IIV Mikrofinanzfonds, a fund managed by Germany-based Invest in Visions (IIV). The names of the microlenders have not released.
During the first four months of 2020, the two share classes of IIV Mikrofinanzfonds generated losses of 2.7 percent to 2.9 percent. This