Dar es Salaam — Incofin Investment Management, a private Belgian company that invests in microfinance institutions (MFIs) through six investment funds, has recently made debt investments totalling $8.75 million in four African MFIs, including Pride Tanzania.
The company said in a statement late this week that it has invested Sh4.5 billion ($2.75 million) in the local organisation, which specialises in financing micro- and small-scale enterprises. The other beneficiaries of the Incofin investment are Lift Above Poverty Organisation (Lapo) of Nigeria; Sinapi Aba Trust (Sat) of Ghana; and First Allied Savings and Loans Limited (FASL), also of Ghana.
"All of the investments have been made through Incofin's Rural Impulse Fund II, which invests in MFIs that primarily serve rural areas and are deemed commercially viable," company noted in the statement.
"Incofin invested Sh4.5 billion (Sh2.75 million) in Pride Tanzania. As of December 31, 2009, Pride reported to the US-based non-profit Microfinance Information Exchange (MIX) total assets of $38.9 million, a gross loan portfolio of $26.9 million, return on assets (ROA) of 3.12 per cent, return on equity (ROE) of 24.2 per cent and approximately 73,000 active borrowers," it added.
Pride is a microfinance institution that provides credit to micro- and small-scale entrepreneurs in Tanzania. Founded in January 1994, it uses a "modified Grameen" methodology where borrowers form groups to guarantee each group member's loan.
It offers loans that range in value from Sh50,000 ($36) to Sh100 million ($ 72,700). Incofin Investment Management is a private Belgian company that develops and manages funds investing in microfinance institutions (MFIs) in developing countries. As of January 31, 2011, Incofin was managing six facilities with total outstanding investments of $206 million (nearly Sh330 billion). To date, Incofin has invested in 91 MFIs in 38 countries.
Its Incofin Rural Impulse Funds (RIF) were launched to invest in rural microfinance institutions (MFIs) that are deemed commercially viable. The two funds include Rural Impulse Fund I and Rural Impulse Fund II. They target both farm and non-farm populations in small towns and villages.
The funds invest primarily through loans, though they make equity investments and guarantees as well. As of January 31, 2011, Rural Impulse Fund I had outstanding investments of $34 million in 20 countries, while Rural Impulse Fund II had outstanding investments of $13.6 million) in six countries.
In Nigeria, Incofin invested 150 million naira (about $1 million) in Lapo, which received an equivalent investment in July 2011. As of December 31, 2009, Lapo reported to MIX total assets of $65.4 million, a gross loan portfolio of $48.8 million, ROA of 4.81 per cent, ROE of 24.5 per cent and approximately 304,000 borrowers.
In Ghana, Sat and FASL each received loans worth $2.6 million) from Incofin. By June this year, the former had total assets of $39.6 million, a gross loan portfolio of $26.4 million and about118,000 active borrowers.
As of 2009, FASL had assets worth $35.9 million, a gross loan portfolio of $16.8 million and some 16,400 active borrowers.
Established in 1987 in Nigeria, Lapo is a microfinance institution that provides savings, investment and loan products intended to address the needs of low-income households. The majority of its clients are engaged in micro-, small and medium-sized enterprises (MSMEs).
Sinapi Aba Trust (Sat) is a microfinance institution in Kumasi. It is an autonomous, private non-governmental organization (NGO) registered on May 30th, 1994. Sat seeks to provide microfinance services to entrepreneurs operating micro- and small enterprises in Ghana.
"Sat is an implementing partner of US-based Opportunity International Network, which has microfinance operations in 20 countries, as well as a member of the US-based Grameen Foundation."