Myanmar MFI, Alliance, secures USD 5 million from AIIF and existing shareholders


Alliance for Microfinance in Myanmar Ltd, a deposit-taking microfinance institution based in Mandalay has received a capital investment of US$5 million from Asia Impact Investment Fund I (AIIF), and other existing investors.

The new shareholder, Asia Impact Investment Fund I is a joint collaboration between UOB Venture Management Pte Ltd, a subsidiary of United Overseas Bank Limited and the Singapore branch of Credit Suisse AG.

The transaction was concluded in August. Existing investors include Singapore’s equity investor in microfinance institutions Base of Pyramid Asia (BOPA), Danish Investment Fund for Developing Countries (IFU), Copenhagen headquartered self-governing state fund, and Insitor Management.

Established in 2014, MFI Alliance started its operations from a partnership between FIDES of Switzerland and BASIX of India to contribute to poverty alleviation and economic growth in the country.

To accomplish this, the company provides financial services and education to low-income households with a focus on women entrepreneurs.

Low-income households can get a loan through a joint liability group, for a loan size between K100,000 (US$80) to 500,000 (US$400) while individual small enterprises are given loan amount of between K500,000 (US$400) and K5 million (US$4000).

“Through micro financing and financial education, Alliance Myanmar has been helping to reduce poverty in the less privileged communities in Myanmar,” said Thng Tien Tat, the executive director of UOB Venture Management.

In Myanmar, there are more than 250 microfinance institutions, including VisionFund Myanmar, Proximity Designs, and Pact Global Microfinance Fund, among some.

However MFI Alliance stands as a leading microfinance institution in the Mandalay region as it has reached a gross loan portfolio of about US$10.07 million in September 2017 with 64,120 active loans with an average loan size of US$230.

Since its inception, the microfinance institution have expanded to 11 branches in Myanmar, operating with 358 staff members. At present, Alliance also has a total savings of about US$1.8 million.

“The new investment will strengthen our capital base and ensure continued expansion, outreach, and development of our service portfolio,” said Alliance MFI’s CEO Kim Guenkel.

The microfinance firm is looking to reach a gross loan portfolio of US$36 million by 2019.

 

Source: https://www.reuters.com/brandfeatures/venture-capital/article?id=16377

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