A US Agency for International Development (USAID) announcement on Thursday said the agency and a group of leading institutional investors have joined forces to create the Global Commercial Microfinance Consortium.
The Consortium is a diverse public-private partnership with investors who have joined together to apply their business know-how, capital and development initiatives to alleviate global poverty through financial market-based solutions.
The Consortium comprises Agence Française de Development, AXA Group, Calvert Social Investment Foundation, CNP Assurances, Deutsche Bank, Geisse Foundation, General Board of Pension and Health Benefits of the United Methodist Church, Gray Ghost Fund, HP, Kaminer Foundation, Left Hand Foundation, Merrill Lynch, Munich Re, Rauenhorst Foundation, Standard Life, State Street Corporation, Storebrand, The Church Pension Fund, The Co-operative Bank plc, UK Department for International Development, USAID, David Fitzherbert, Elizabeth and Steve Funk, Deepak Kamra and Janet A. McKinley.
Deutsche Bank has managed the sale of the $75 million fund. The fund will provide commercially structured financing for Micro Finance Institutions (MFIs) working throughout the developing world in providing credit to the self-employed poor, such as street vendors, traders, farmers and service providers.
Nearly $30 million has already been committed to MFIs working in Peru, Kosovo, Nicaragua, Azerbaijan, Colombia, Pakistan, Mozambique and India.
This groundbreaking $75 million multi-tiered commercial fund, it added, will provide local currency financing for up to five years to MFIs globally. USAID has provided a $15 million credit guarantee to promote private sector investment in the Consortium, the announcement said.