Agora Microfinance Zambia– USD 5.0 mln Debt
Agora Microfinance Zambia Limited (AMZ) is Zambia’s leading rural-based microfinance institution established in 2011 that provides financial services to a largely (90%) rural clientele, currently comprising >89,000 clients, of which 56% are women, and 34% young. AMZ provides small loans (avg. USD 68) to individual entrepreneurs as well as village groups (87% of loan book). Microinsurance, as well as mobile money transactions, are a rapidly growing line of business. AMZ’s mission is to contribute to the improvement of the livelihoods of the poor through effective provision of appropriate financial services. FMO has a long-standing partnership with Agora having advanced the first facility of USD 2.5mln to the MFI in 2019. FMO provided a USD 5.0mln facility to Agora. This facility was part of the DFC-MASSIF master participation agreement with USD 3.35M (67%) being provided by DFC. This facility will be used for on lending to rural, female, and young microentrepreneurs.
Babban Gona Farmer Services Nigeria Ltd. – USD 10.0 mln debt
Established in 2012, Babban Gona (“Great Farm” in Hausa) is a financially sustainable and scalable agricultural enterprise co-owned by its farmers. The company provides cost effective end-to-end services to a network of franchise farmer groups on credit that is repayable at the end of the season. These services include training in sustainable farming, crop insurance, access to storage facilities, including a warehouse receipt program, marketing and distribution of products and access to credit, fertilizer, and seeds. Furthermore, Babban Gona has developed a ‘Last Mile’ business line. This initiative provides Babban Gona members with products (e.g., fertilizer, FMCG goods) to sell to non-Babban Gona members, thus further increasing their net incomes. After a first loan provided to Babban Gona in 2017, FMO advanced an additional loan of USD 10mln that will allow Babban Gona to further expand its innovative farmer service model which is estimated to increase smallholders’ yields to up to 2 times the national average. This facility was part of the DFC-MASSIF master participation agreement with USD 6.7mln (67%) being provided by DFC.
Banco de Antigua S.A. – USD 7.0 mln debt
Banco de Antigua, S.A. ("BDA" or “the Bank”), founded in 1997, is a small microfinance bank in Guatemala. BDA focuses on consumer finance for low-income segments (68% of loan portfolio) as well as microentrepreneurs (18%) and SMEs (13%). The bulk of its activities are in semi-urban and rural areas of Guatemala. BDA has the third largest microfinance portfolio across the financial system and an important presence, particularly in rural areas. BDA has an extensive geographic coverage with 55 agencies across the country, including rural and remote areas where besides the national bank, there are no other financial institutions present. Coverage has been increasing via slimmed-down agencies that focus on digital services (no cash) and are very cost-efficient to set up. FMO advanced a USD 7mln loan that is earmarked for Microfinance lending and financing SMEs in rural areas in Guatemala. The facility was advanced in Local Currency (GTQ) which is line with MASSIF’s strategy towards reducing inequalities (SDG10). Furthermore, capitalizing on our Capacity development program, we will be working with Banco de Antigua to further improve their consumer protection policies and practices. This facility was part of the DFC-MASSIF master participation agreement with USD 4.69mln (67%) being provided by DFC.
Chamroeun Microfinance PLC– USD 10.0 mln Debt
Chamroeun Microfinance Plc is a regulated microfinance institution in Cambodia. Chamroeun’s main product offering consists of small productive loans. Chamroeun currently operates in 15 provinces, has 21 branches, employs over 370 staff. Although significant progress has been realized the last two decades, still a significant share of Cambodian population has no access to formal financial services. Chamroeun is committed to lifting people out of poverty by providing small uncollateralised loans for productive use and onboarding marginalised people in formal credit channels. With Chamroeun’s focus on female entrepreneurs in rural areas, underserved people are reached by partnering with Chamroeun. FMO advanced a USD 10mln loan facility to Chamroeun which is the first DFI loan to the MFI. Furthermore, FMO brings additionality by providing scarce long-term financing and supporting the growth of Chamroeun’s reducing inequalities portfolio. This facility was part of the DFC-MASSIF master participation agreement with USD 6.7mln (67%) being provided by DFC.
Fairtrade Access Fund SA, SICAV-SIF– USD 3.5 mln Debt
Fairtrade Access Fund SICAV-SIF is an evergreen impact investing fund established in 2012 that focuses on sustainable agri value chains and focus on smallholder farmers, currently in Latin America and Africa. It provides trade finance to Small producer organizations (SPO) that have a sustainability certification, with an emphasis on Fairtrade certification. It also provides financing to agri SMEs and microfinance institutions financing agricultural activities. The fund provides market access and financing to thousands of smallholder farmers that subscribe to better sustainability practices: in 2020, the fund supported over 327,000 farmers with 892,871 hectares under cultivation in 20 African and Latin American countries. Since most clients are certified under a sustainability certification, this has translated into premiums resulting in income stability for individual farmers as well as investments in community-based healthcare, education, infrastructure and, more importantly in 2020, pandemic mitigation and safety projects. FMO provided a USD 3.5 mln revolving credit facility to finance the annual growth of the portfolio that results from financing seasonal crops such as coffee.
Horizon Capital Growth Fund IV, L.P. – USD 7.5 mln Debt
Horizon Capital Growth Fund IV, L.P. (the “Fund”, “HCGF IV”) is a private equity fund investing in Ukraine and Moldova, managed by Horizon Capital (the “Fund Manager”). FMO has an existing relationship with Horizon Capital, having invested in all four of the private equity funds managed by Horizon Capital and established to date (Emerging Europe Growth Fund I, II & III, and Horizon Capital Growth Fund II). The fund has been established to invest primarily in fast-growing, export-oriented, asset-light companies that leverage Ukraine’s competitive cost base to generate global revenues. In addition, the Fund may also seek out select domestic champions with potential to grow from local to regional market leaders. Sectors will include IT, e-commerce, innovative retail, consumer goods and fintech. Ukraine has a large, talented, and competitive labour force, both for IT and skilled manufacturing. Ukraine and Moldova are experiencing strong demand for growth-stage capital in both technology and traditional sectors. FMO via MASSIF committed a USD 7.5mln investment. Besides this FMO committed an additional USD 7.5mln via Building Prospects and a final USD 5.0mln via FMO’s own balance sheet. By participating in the Fund’s first closing, FMO played a catalysing role in helping the Fund attract other investors (DFIs and private investors) and reach its target size and objectives. Through its commitment, FMO also supports the Fund Manager in contributing to Ukraine’s economic recovery and ensuring that local businesses have access to growth capital, thus remaining resilient, agile and continuing to thrive, despite the context of the ongoing war.
Lendable MSME FinTech Credit Fund – USD 5.0 mln Debt
Lendable is a leading debt finance provider to fintech companies across frontier and emerging markets that create access to new financial products and services for un- and under-banked populations. Lendable finances fintech companies that facilitate consumer and MSME credit, productive asset finance, payments, remittances, and digital marketplaces. From its offices in Nairobi, London, and Singapore, and using its proprietary technology and data, Lendable directly originates, structures, underwrites, and monitors all transactions. In 2021, FMO co-anchored the Lendable MSME Fintech Credit Fund (LMFCF), providing a USD 5 mln debt facility. In 2022, we advanced a further USD 5mln to the fund based on the fund’s performance potential. With this financing, Lendable will support fintech companies in Africa and Asia, a niche not served by traditional impact fund managers.
Watu Credit Limited (Kenya)– USD 10.0 mln Debt
Watu Credit Limited (Kenya) (‘Watu’) is a micro-lending company providing pay as you go financing to young entrepreneurs operating motorcycles (boda bodas) and tuk tuks transport businesses in Kenya. Watu’s mission is to meaningfully improve employment and opportunities for those with the greatest barriers to access financial services. Watu has been operating since 2015 and currently has operations across Kenya serving more than 200,000 clients. 90% of Watu’s clients are youth (between 20 and 28 years) and 70% are based in rural areas. FMO provided a USD 10.0 mln debt facility, through which we support one of the top micro-lending institutions in Kenya to increase its MSME lending activities with a particular focus on youth owned and rural mobility MSMEs. As a non-deposit taking institution, FMO's long-term funding is providing Watu Credit with stability and security of funding to enable it to further grow and expand its reach across Kenya. This facility was part of the DFC-MASSIF master participation agreement with USD 5.0mln (50%) being provided by DFC.
Watu Credit Uganda Limited– USD 5.0 mln Debt
Watu Credit Uganda Limited (‘Watu’) is a micro-lending company providing pay as you go financing to young entrepreneurs operating motorcycles (boda bodas) and tuk tuks transport businesses in Uganda. Watu is wholly owned by Watu Holding Limited registered in Mauritius and with operating companies in 6 countries in Africa, and with plans to grow further across the region. Watu’s mission is to meaningfully improve employment and opportunities for those with the greatest barriers to access financial services. Watu has been operating since 2019 and currently has operations across Uganda serving more than 40,000 clients. 90% of Watu’s clients are young entrepreneurs (aged between 20 and 28 years) and 70% are based in rural areas. FMO advanced a USD 5.0 mln loan that will be used for on-lending purposes to self-employed individuals and will be used to specifically grow Watu’s youth and rural focused MSME mobility portfolio in Uganda. This facility was part of the DFC-MASSIF master participation agreement with USD 3.35mln (67%) being provided by DFC.
ASEAN Frontier Markets Fund– EUR 10.0 mln Equity
ASEAN Frontier Markets Fund L.P. ("AFMF") is a sector-agnostic Private Equity fund targeting investments in SMEs in Cambodia and Laos. It is the third Fund managed by Emerging Markets Investments Advisers (“EMIA”). FMO and MASSIF previously committed to the Fund Manager's two predecessor funds and have an existing relationship with the team. The Fund focuses on investments in Cambodia and Laos, where impact potential is high and the penetration of PE activities remains low. FMO provided a USD 10mln equity investment into this fund supporting it to reach first close. The Fund has a sector agnostic strategy and will invest primarily through equity. The Fund intends to take significant minority stakes in 10- 13 investees, mainly growth equity to SMEs (>65% of invested capital) and earlier-stage companies/greenfield (up to 35%). The investment will allow FMO to keep supporting a trusted partner active in countries where there are limited Private Equity teams with on-the-ground presence and local knowledge.
Commercial International Bank (CIB) NASIRA Portfolio– EUR 0.74 mln NASIRA Guarantee
Commercial International Bank (CIB) is the largest privately-owned commercial bank in Egypt with total assets of USD 32bln and a market share of ~5%. In 2018, CIB underwent a transformation to revamp the SME lending business by launching a tailored loan program, with various products and advisory services. This was largely motivated by the Central Bank of Egypt’s requirement for all banks to lend 25% of their loan portfolio to SMEs (of which 10% to MSMEs) by end of 2022. However, CIB’s exposure to the segment has remained limited as its efforts were challenged by the COVID-19 crisis. The USD 50mln Nasira guarantee facility will focus on CIB supporting youth entrepreneurs and stimulating MSME lending to entrepreneurs with less collateral. The guarantee will cover MSME loans up to max. USD 500,000, falling under the bank’s Business Banking unit, which accounts for <5% of CIB’s productive loan portfolio. The Nasira team will be working with CIB on their risk management and help set up research to better understand the youth market (52% of Egyptian youth is unemployed currently).
I and M Bank Limited – KES 38.84 mln NASIRA Guarantee
I&M Bank Kenya is wholly owned subsidiary of I&M Holdings Limited, a publicly traded company at the Nairobi Bourse. The bank was founded in 1974 and evolved from a community financial institution to a major regional commercial bank offering a full range of corporate, SME and retail banking services. I&M Bank has been a client of FMO since 2010 and has demonstrated consistent growth and stable performance over the years, growing its balance sheet from USD 0.9mln in 2010 to USD 2.7bln in 2021, whilst maintaining a strong Capital Adequecy Ratio and good profitability. FMO and I&M Bank Kenya signed a USD 15mln (in LCY equivalent) Nasira portfolio guarantee covering loans provided to Covid-19 affected micro and small enterprises (MSEs) in Kenya. MSMEs in Kenya, especially youth and women-owned, have limited access to external financing despite being a key driver of the Kenyan economy. The NASIRA facility will also include Capacity Development and Technical Assistance support through non-financial services such as business digitization, enhancing MSME lending practices, financial literacy.
Jordan Micro Finance Company Ltd - JOD 0.18 mln NASIRA Guarantee
Jordan Micro Finance Company Ltd (“Tamweelcom”), which was established in 1999, is the third largest microfinance institution in Jordan. Its mission is to support employment, foster socio-economic stability and empower low-income individuals in Jordan. One of its target groups are youth and women entrepreneurs. Tamweelcom benefits from a strong market positioning via its wide network of branches across Jordan, particularly in the smaller urban areas. As the Jordanian economy slowly recovers, Tamweelcom would like to continue supporting its clients and reach additional micro/small businesses in line with its social mission. To support the bank’s overall ambition and the overall Jordanian MSME’s community, FMO and Tamweelcom have signed a USD 10mln in JOD equivalent revolving portfolio guarantee. This guarantee will cover Tamweelcom’s existing and new MSME portfolio of COVID-19 affected MSMEs including migrants, women and youth owned in Jordan.
Vitas Palestine Microfinance Company – USD 0.50 mln NASIRA Guarantee
Vitas is a subsidiary of Global Communities Palestine (97%) and Vitas Group (3%). GCP and Vitas Group are both owned by Global Communities US. he urgent need for better access to financial means for entrepreneurs in West Bank and Gaza is clear. With a growing population of which more than 70 percent is under the age of 30, and one of the highest unemployment rates in the world (50% in Gaza in 2018), economic growth and financial inclusion is high on the priority list of the Palestinian authorities.FMO and microfinance institution Vitas Palestine signed a USD 10mln Nasira portfolio guarantee to support the financial inclusion of MSMEs affected by Covid-19, including female and young entrepreneurs, operating in Gaza (40%) and the West Bank (60%). The Nasira product offering has a comprehensive Covid-19 support package to MSMEs in the region. The accompanying Technical Assistance program will aim at supporting Vitas to expand its value proposition towards youth- and women owned MSMEs.