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MICROCAPITAL STORY: Peruvian Microfinance Institution Créditos Arequipa to Float Bonds on National Exchange, Backed by the Inter-American Development Bank (IDB)
Créditos Arequipa, a microfinance institution (MFI) which serves approximately 26,000 clients in Peru’s two largest cities, plans to begin issuing debt on the local stock exchange in an effort to reduce its dependence on foreign currency funding. Créditos Arequipa is one of 14 Edpymes- specialized microcredit institutions regulated by the governmental organization Superintendencia de Banco, Seguros, y AFP (SBS)– in Peru. At the end of July 2007, it had 145 million soles (USD 46 million) in total assets.
IDB’s Report Concludes that Microfinance Outreach has Increased Immensely in Latin America and the Caribbean, but still has a Long Road Ahead
The success attained by microfinance institutions in recent years, has greatly expanded the outreach of the financial system to millions of households in Latin America and the Caribbean. However, although previous measurements of success have been made on a general level, the enclosed report by the Inter-American Development Bank adequately explores the magnitude of the microfinance market in Latin America and the Caribbean.
Indian ICICI Lombard General Insurance Allies with the Small Industries Development Bank of India (SIDBI) to Include Non-Life Insurance in its Microfinance Sector
Industrial Credit and Investment Corporation of India Lombard General Insurance (ICICI) signed an agreement with the Small Industries Development Bank of India (SIDBI), a state-run bank that provides loans to support small and medium enterprises and several Indian microfinance institutions, pledging to provide non-life insurance products to the micro, small and medium enterprises supported by SIDBI.
IDB Provides Loan to Honduran Government for Support of Low-Income Housing
The Inter-American Development Bank (IDB) announced recently that it will be loaning the government of Honduras $30 million for the promotion of low-income housing. Most notably, the bank announced that the loan is the first step in a multiphase program that may include a second $30 million loan for the establishment of a microcredit housing fund. The project falls under the IDB’s new Building Opportunity for the Majority initiative. The loan will be repaid over the course of 40 years, with a 10 year grace period. It has an annual interest rate of 1% during the first decade and 2% over the rest of its life. The money will be distributed to low income families as subsidies toward the purchase, construction or renovation of new and existing homes. Additionally, municipal governments will receive subsidies for the development of infrastructure in poverty-stricken areas. Others involved in the project include the World Bank, the Central American Bank for Economic Integration (CABEI), Germany’s Kreditanstalt f̹r Wiederaufbau (KfW) and the Swedish International Development Agency (Sida).
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IDB Head Calls for a Tripling of Microfinance Operations in Latin America and the Caribbean
Luis Alberto Moreno, president of the IDB, suggested that the sector should grow to have annual operations of US$15 billion by 2011, citing the fact that “microfinance institutions in Latin America currently only serve about 8% of estimated demand.” The comments were part of his opening speech to the Ninth Annual Inter-American Forum on Microenterprise in Quito,Ecuador, which was attended by 1200 microfinance practitioners from around the world and centered around the topic of Financial Democracy.
Small Industries Development Bank of India (SIDBI) Makes over $220,000 Microfinance Equity Investment in SKS Microfinance
On January 31, 2006, SIDBI made their first equity investment in a microfinance institution (MFI) by presenting two SKS Microfinance (SKS) clients with a check in the amount of $113,095. This represents half of SIDBI’s total investment amount of $226,192 corresponding to a 7% stake in SKS Microfinance (SKS). Although SIDBI has supported microfinance through loans and capacity building, this is their first direct equity investment.
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MICROCAPITAL BRIEF: Michael Apel Named CEO of DAI’s MicroVest Asset Management
The US-based impact investing firm MicroVest recently selected Michael Apel as its new CEO and Chief Investment Officer. In taking on these roles, Mr Apel will be in charge of the company’s daily operations, including entering into new markets to expand the company’s deployment of private capital to boost micro-, small and medium-sized enterprises (MSMEs). Mr Apel has 25 years of experience at IDB Invest,
MICROFINANCE EVENT: 5th Annual CLIIQ Nexus Latam; September 26-28, 2023; Cuenca, Ecuador
This year’s Cumbre Latinoamericana de Inversión de Impacto (CLIIQ) will bring together impact investors in Latin America for discussions in arenas such as: (1) Diversity and Inclusion: Gender and Beyond; (2) Climate Solutions; (3)
MICROFINANCE EVENT: Global SME Finance Forum; September 12-14, 2023; Mumbai, India
The ninth iteration of this event will explore financial services providers’ delivery of digital services to small and medium-sized enterprises (SMEs), leveraging samples from India and abroad. The forum will cover topics – particularly “ecosystems” – relating to digital finance, international
MICROCAPITAL BRIEF: Cubo Raises $3.5m in Debt, Equity to Boost Acceptance of Digital Payments by Microenterprises in Central America
El Salvadoran startup Cubo, in an effort to bring its digital payments solutions to Guatemala, Panama and Costa Rica, recently raised USD 3.5 million in seed financing from investors including IDB Lab, a member of the Inter-American Development Bank (IDB) Group, and three venture capital firms, Colombia-based Latin Leap, Peru’s Seedstars and India’s Soma Capital. Cubo expects the new funding to allow it to reach about
MICROFINANCE EVENT: CERISE+SPTF Annual Meeting; Towards Impact Conference; September 28-30, 2022; Paris, France
The first of these events – the combined annual meeting of the Social Performance Task Force (SPTF) and Comité d’Echange, de Réflexion et sur les Systèmes d’Epargne-Crédit (CERISE) – is titled Celebrating 10 Years of the Universal Standards for Social and Environmental Performance Management. The first day will include
MICROCAPITAL BRIEF: Visa, Davivienda Announce Commitments to Digitize Financial Services in Central America
Visa, a US-based financial services company, recently announced its commitment to further “digital and financial inclusion” in Central America as a response to the US government’s Call to Action for Northern Central America. Visa plans to invest USD 270 million to
MICROCAPITAL BRIEF: Bankingly of Uruguay Raises $11m in Equity Round Led by Dalus Capital to Help Financial Institutions Boost Digital Inclusion in Africa, Asia, Latin America
Uruguay’s Bankingly recently secured an investment package totalling USD 11 million, which it plans to use to expand in Latin America and Africa as well as enter Southeast Asia. Bankingly provides financial institutions with software-as-a-service (SaaS) that helps them serve customers via websites, mobile apps, chatbots and other tools, thus “facilitating the financial inclusion of millions of people…”. Bankingly CEO and Founder, Martin Naor, expressed the hope that
MICROCAPITAL BRIEF: Aavishkaar India Fund VI Nets $130m for MSMEs Addressing Climate Change, Agtech, Fintech – Anchored by Public Funding from Domestic, European Sources
Aavishkaar Capital, a subsidiary of India’s Aavishkaar Group, recently completed the first close of its Aavishkaar India Fund VI with commitments totaling INR 10 billion (USD 130 million) to invest mainly in micro-, small and medium-sized enterprises (MSMEs). In particular, Sushma Kaushik, a partner at Aavishkaar Capital, said that the fund aims to
MICROCAPITAL BRIEF: Satisfied Producer of Palm Oil in DRC Has Been “Brought Back from the Brink,” DFIs Sell Debt Holdings in PHC to Maku; Funding to Improve Community Relationships Will Continue
Four European development finance institutions (DFIs) recently sold their debt holdings in Plantations et Huileries du Congo (PHC), a palm oil business in Democratic Republic of the Congo, to Maku Holdings, an affiliate of Kuramo Capital Management, which has offices in Kenya, Nigeria and the US. The DFIs are
MICROCAPITAL BRIEF: HDFC Bank to Lend $100m to Micro-, Small, Medium-sized Enterprises (MSMEs) in India – Half Led by Women – with Support from DFC, Mastercard, USAID
HDFC Bank, an affiliate of India’s Housing Development Finance Corporation, recently agreed to lend USD 100 million to micro-, small and medium-sized enterprises (MSMEs) in India to support their usage of digital payments, including to adjust to the COVID-19 pandemic. Half of the credit facility is
MICROCAPITAL BRIEF: Citi, DFC Announce $15m Local-currency Loan to CAME of Mexico to Boost Financial Inclusion of 40,000 SMEs
Consejo de Asistencia al Microemprendedor (CAME), a Mexican microfinance institution, recently agreed to borrow MXN 300 million (USD 15 million) through a partnership between US-based bank Citi and the government-backed US International Development Finance Corporation (DFC). The proceeds of the term loan are to be