USAID, Private-Sector Partners Create Global Fund for Small Entrepreneurs And Low-Income Families
Agency Provides $15 Million Credit Guarantee To Fund Aimed At Alleviating Poverty
FOR IMMEDIATE RELEASE
November 2, 2005
1031-05-108
Press Office: 202-712-5174
Public Information: 202-712-4810
www.usaid.gov
Contact: USAID Press Office
WASHINGTON, DC-The U.S. Agency for International Development (USAID) and a group of leading institutional investors announced today that they have joined forces to create the Global Commercial Microfinance Consortium. This ground-breaking $75 million multi-tiered commercial fund will provide local currency financing for up to five years to Micro Finance Institutions (MFI) globally. USAID provided a $15 million credit guarantee to promote private sector investment in the 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. Microfinance is the provision of financial services to economically active micro and small entrepreneurs and low-income families globally, and MFIs are specialized financial institutions that provide credit to the working poor worldwide.
"USAID is a proud supporter of innovative partnerships. By focusing on what each of us does best, this Consortium is an example of what the public and private sectors can accomplish together," said USAID Assistant Administrator Jacqueline E. Schafer, who attended a ceremony for the fund in New York. "This is a pioneering initiative to reduce poverty by mobilizing private capital to bring financial services to hundreds of thousands of families and businesses that have not had access to such banking services."
The Consortium is comprised of: Agence Française de Développement, 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, MMA, Munich Re, Rauenhorst Foundation, Standard Life, State Street Corporation, Storebrand, The Church Pension Fund, The Co-operative Bank plc, UK Department for International Development, the U.S. Agency for International Development, David Fitzherbert, Elizabeth and Steve Funk, Deepak Kamra and Janet A. McKinley.
Deutsche Bank managed the sale of the $75 million fund. The fund will provide commercially structured financing for 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.
USAID's microfinance levels of more than $100 million per year in recent years and its insistence upon the application of best practices by the hundreds of USAID-supported microfinance providers in over 50 countries make it the leading bilateral donor in the field.
The U.S. Agency for International Development has provided economic and humanitarian assistance worldwide for more than 40 years. For more information on USAID, visit: http://www.usaid.gov.
The U.S. Agency for International Development has provided economic and humanitarian assistance worldwide for more than 40 years.
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