Japan's 1st Microfinance Fund to be Set Up to Assist Loans in Cambodia

Aug 2009
Tokyo, Japan, August, 22 2009 - A Japanese music production and fund management company plans to create a microfinance investment fund worth up to 50 million yen (USD 540'000), the first of its kind in Japan, to support farmers and businesses in Cambodia, company officials said Saturday.

Music Securities Inc., based in Tokyo, will start accepting money for the fund from individual investors mainly via the Internet by the end of this month, the officials said. Investments will be made in increments of 30,000 yen.

The fund will then invest in Cambodia's CHC Ltd., a Phnom Penh-based microfinance institution, which will extend loans to domestic farmers and businesses, the officials said. CHC will rename itself SAMIC in November.

The new fund was initially organized by Living In Peace, a nonprofit organization established in 2007 to help promote international development assistance, and the NPO asked Music Securities to manage the fund because an NPO is not allowed to deal with financial products.

Such a fund "is not a donation but an investment. We want investors to maintain an interest in how their investments will be used for poverty eradication," said Akiko Sugiyama, an official at Music Securities' securitization division.

Investors in the fund will receive returns after three years, the officials said.

If the earnings performance of CHC remains at the current level over the next three years, the new fund will have an annual return of 2.8 percent before tax, the officials said. But investments could fall below initial value depending on CHC's performance and foreign exchange rate fluctuations, they said.

Microfinance is the brainchild of Bangladeshi economist Muhammad Yunus, who won the 2006 Nobel Peace Prize for his efforts to eradicate poverty with the lending method. Many borrowers use their loans to start up small businesses, find ways to secure sources of income and escape poverty.

Source : Breitbart

Research Analysis Tools

The fund indexes, institution benchmarks and other market information displayed here are all Symbiotics designed analysis tools, created in-house by our analysts and experts. Symbiotics has one of the oldest track records in microfinance investment analysis dating back to the late 1990s; its indexes and benchmarks have been regularly used as markers by investors, asset managers, financial institutions and practitioners. These, as well as several other research products, are available through the Research Account. Click on the link below to find out more.

Learn More