Over 80% of Investors Haven't Reduced Microfinance Investment Portfolio Due to G...

Mar 2009
Mumbai, India, March, 11 2009 - As the recession spreads to developing countries around the world, and the effects of the crisis set in, Microfinance Insights explores how the microfinance sector is coping with the global recession. In the March/April 2009 issue, Global Crisis & Microfinance, sector stakeholders, from institutional investors to microfinance institutions and their clients, reveal how they have been affected by the liquidity crisis and speculate on when it will end.

Microfinance clients, many of whom are below the poverty line, have felt the squeeze with rising food and energy prices, decreases in remittances and less availability of loans.  Many microfinance institutions (MFIs), particularly those not permitted to mobilize deposits, have struggled to maintain the liquidity to continue loan cycles without interruption.  As the situation worsens, equity investors continue to show interest in investing in large microfinance institutions, confident that many established MFIs will weather the crisis.

Microfinance Insights, the international print magazine, brings a diversity of new perspectives to the forefront in this issue, shedding light on the road ahead for the sector.  In this issue, the magazine publishes a new survey on microfinance and the global economic crisis, gathering views from 120 MFIs and 40 investors from around the world on a range of issues from strategic organizational changes to risk assessment.  The survey reveals that over 25% of non-deposit taking MFIs have decreased their lending in the last 12 months and 20% have reduced their staff size.  Forty-one percent of MFIs have had to face higher interest rates from lenders, and 37% have modified their growth plan downwards.  Nevertheless, more than 4/5 of investors have not reduced their portfolio allocation towards MFIs.  More survey statistics can be found in the latest issue of Microfinance Insights.   

Features of Vol. 11 Microfinance Insights, Global Crisis & Microfinance include:

  • How Microfinance can make it through the Global Recession by Yana Watson of Dalberg Global Development Advisors
  • Commentary on the Dangers of Leverage by Vinay Nair, Executive Director, JP Morgan
  • Alok Prasad, Country Director, Citi Microfinance Group, Citi India, on lending to MFIs during the downturn
  • Roshanah Zafar, Founder Kashf, on Political Interference in Pakistani microfinance
  • Milford Bateman, Visiting Professor of Economics at the University of Juraj Dobriain Croatia, critiques the microfinance sector
  • Bhakti Mirchandani, Associate Vice President at Unitus Capital, on the need for a publicly traded MFI index
  • Perspectives from borrowers in Mexico and Nigeria, and Triodos, KIVA and Aga Khan Foundation
  • And much more…

Source : Intellecap

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