IFC Boosts Women’s World Bank Micro-lenders
IFC continues to back micro-lenders with two recent deals associated with the Women’s World Bank.
The financial sector remains IFC’s largest focus in Colombia. I last wrote about its big backing of Bancolombia – the country’s largest bank – on programs offering hedging instruments to sophisticated clients and to fund Bancolombia’s investment bank unit in acquiring (presumably with other investors) non-performing loans originated by its lending unit. These were two of four deals in the financial services sector out of the seven projects that have been announced in the last six months.
Bancamia is being transformed with $30 million in IFC funding from an NGO to a bank. It was created as a joint venture, in 2008, by a foundation association with Spain’s BBVA bank (51%), and Corporación Mundial de la Mujer (Women’s World Bank) of Medellín (24.5%) and of Colombia (24.5%). The purpose of the shift from NGO to a bank is “to increase access to finance to micro enterprises, low and middle-income segments, rural populations, and women. The project has been designed as a blend of advisory services, equity and debt, where IFC is acting as an advisor and partner geared at facilitating the growth of the Bank.”
Funadción Mujer Mundial, from Popayan, in Cauca department, is the other recent Women’s World Bank affiliate that IFC is financing. It is “the second largest provider of microfinance in the country in terms of assets (excluding supervised banks), was founded in 1989 and operates as a nonprofit organization.” IFC is injecting $6 million into FMM Popayan to enhance its work. While affiliated with Women’s World Bank, there is no ownership relationship. FMM Popayan has, however, “benefited from technical assistance services, information and know-how geared to strengthen their scale, efficiency, sustainability and impact.”