MFBs in Nigeria, Ghana Receive 40m Euros Foreign Investment

Jun 2010
Lagos, Nigeria, June, 15 2010 - The microfinance sector in Nigeria and Ghana has received a boost through a 40 million Euro fund, launched in a joint venture by Goodwell Investments from The Netherlands, Alitheia Capital of Nigeria and JCS Investments from Ghana.

Goodwell West Africa, a business development company based in the Netherlands, has received commitments of EUR 8 million (USD 9.7 million) from KfW Entwicklungsbank (KfW), a German development bank, and EUR 1.6 million (USD 1.9 million) from Norwegian Microfinance Initiative (NMI), for investment in microfinance institutions (MFIs) in developing countries.

The funds will be invested in established MFIs as well as emerging MFIs in Ghana and Nigeria. Goodwell West Africa’s strategy is to provide a combination of growth capital, on the ground support and access to the expertise of experienced microfinance practitioners.

The fund will provide long-term capital and active support to start-up and growth phase microfinance institutions in both countries to kick start and accelerate their growth and build value whilst maintaining their social focus.

As of 2009, Goodwell Investments had $25 million in fund assets all of which was allocated to microfinance funds.

Goodwell Investments is a for-profit business development company that started operations in 2006. It invests inentrepreneurial microfinance organisations on a socially and commercially sustainable basis.

Alitheia is an investment manager and advisor based in Lagos, whose mission is to broaden the ownership of businesses and real estate by enabling socially sustainable investments. Alitheia creates investment structures, provides project management and develops businesses. Its business services include fund management, project/business incubation and corporate strategy and development.

JCS Investments is a Ghana-based financial services company licensed by the Securities and Exchange Commission. It operates as a fund manager and financial advisor

Goodwell is a social investment company that aims to contribute to poverty alleviation and sustainable development by developing and implementing instruments that create social and financial value.

Alitheia Capital, Goodwell Investments and JCS Investments presented the results of an in-depth study on the potential for microfinance in Anglophone West Africa which was intended to focus industry attention on the region.

The findings showed that there is tremendous potential for expansion of microfinance in the West Africa region. The challenges faced by MFIs in general were also recognized as inadequate financing, shortage of skilled personnel and an effective business model.

According to the Consultative Group to Assist the Poor (CGAP), Nigeria has a shallow financial sector with the majority of Nigerians lacking access to formal financial services. A recent survey showed that 74 percent of adult Nigerians (64 million people) had never been banked, only 5 percent of women have a bank account, and 86 percent of rural adults are unbanked.

The gap between supply and demand is equally large in Ghana, where only an estimated 4-5% of the population has access to formal financial services.

The Goodwell West Africa Microfinance Fund will jump into this market gap and address part of the inadequate supply of financing and skills.

Goodwell is active in supporting business solutions in the area of water and sanitation, and renewable energy.

Source : The Nation

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