Une offre en conseil et en financement durable pour les IMF au moyen d’un fonds : LMDF

Project objective
Support and assist MFIs in their fundraising

Areas of intervention
Latin America, Southeast Asia, Central Asia, Africa

Project manager

Key figures in Q4 2018
- 48 MFIs financed in 23 countries
- outstanding loans: €28.7 million
- average loan: €1,294
- average exposure per MFI: €632,000
- 60,058 microentrepreneurs directly affected, 80% of them women
- 70% of customers in rural areas
- 50% of the MFIs financed receive technical assistance adapted to their needs

Partner

LMDF

Contact

Portraits

Sustainable funding for your MFI


Through the Luxembourg social fund LMDF, ADA offers 2 types of funding for Tier 2 and 3 MFIs located in Africa, Latin America, Southeast and Central Asia. In addition, ADA can provide technical assistance.


Since 1994, ADA has been committed to strengthening the financial inclusion of population groups excluded from the conventional banking sector through tailored financing and technical assistance for microfinance institutions (MFIs), with an emphasis on forging long-term partnerships.
Thanks to a social investment fund, created by ADA in 2009, the Luxembourg Microfinance and Development Fund (LMDF), ADA has funding solutions for the growing MFIs.
 

Financial services for MFIs....

ADA offers 2 types of funding for Tier 2 and 3 MFIs located in Africa, Latin America, Southeast and Central Asia:

  1. Senior debt: an amount between USD 0,2 and 1,5 million, granted in local currency, USD or EUR, with a maximum term of 5 years, at the market rate.
  2. Subordinated debt: an amount between USD 0,2 and 1,5 million, granted in local currency, USD or EUR, with a term of between 5 and 7 years, at the market rate.
     

...combined with non-financial services

Other than offering financial services, ADA can propose:

  • support, listening and follow-up from its team during the entire funding cycle;
  • tailor-made technical assistance program tailored to the needs of MFIs to improve their performance: this programme, called ADA 3T (Tools, Trainings and Technical Assistance) includes, as its name suggests, management tools, various training courses (financial and social performance, risk management, agricultural finance, digital finance, etc.) and technical assistance. Ultimately, this support enables MFIs to achieve their social goals to attract an ever-increasing number of investors.

Discover the ADA 3T offer

ADA 3T


LMDF and co-financing

LMDF (Luxembourg Microfinance and Development Fund) is a Luxembourg investment fund established by ADA in 2009, which main aim is to facilitate access to a more responsible form of financing by creating long-term relationships between investors, the MFIs and their clients.

ADA has a dedicated team which provides investment advice to LMDF. Its work is, first of all, about identifying MFIs with a strong social and financial performance matching the profile sought by LMDF amongst the small MFIs (Tier II and III). To this purpose, the team undertakes prospecting missions in the field, to meet with MFIs or to attend events (conferences, Investor Fairs, …). If an MFI meets the eligibility criteria, ADA performs a preliminary audit in the field, called due diligence, to check the MFI’s financial figures and to meet with its managers and clients. Once it is back in Luxembourg, ADA submits the application for financing to the LMDF Committee, which decides whether to invest in the MFI through senior or subordinated loans. The time between application and grant varies from 3 to 6 months depending on access to information and compliance with eligibility criteria.

ADA may also provide complementary funding so as to directly co-finance certain activities carried out by the MFI. One example of the co-financing is the payment of all, or part, of the costs of the assessments carried out by rating agencies specialised in microfinance.


Eligibility criteria for funding

Conditions for funding

Do you think you meet all the eligibility requirements within your MFI? Fill out the funding application form below and send it to:

I fill out the financing request form for MFIs


The 7 steps in the process of obtaining funding

The 7 steps in the process of obtaining funding


"For greater impact with our funding"
Sarah Canetti, Head of Investment Department at ADA

Sarah Canetti

"With more that forty microfinance institutions benefiting from funding, in nearly 20 countries, ADA, through the LMDF fund, is a partner of choice for MFIs. Moreover, ADA’s action is not confined to providing funding advice. Indeed, we stay close to our partners and forge our relationship through regular follow-up. Our whole team remains attentive to what you have to say so as to develop long-term partnership with you.

In addition to the funding and beyond the follow-up, we can offer technical assistance tailored to our partners, whenever a need is felt. 75% of the MFIs funded benefit from this personal support and this strengthening of capacity that we define together. This is in essence our wish and our vision: to give the institutions both the financial and technical means to act.

Our activities are thus concentrated in four main regions of the world: Africa, Latin America, Southeast Asia and Central Asia. This diversification is a strength and a chance. It demonstrates our success and ambition as well as our capacity. ADA, with LMDF, supported by the Luxembourg government, uses the expertise of one of the leading financial markets in the world to support socially responsible MFIs, leading actors in fighting poverty and in favour of financial inclusion."


Quito

Providing advice and sustainable financing for MFIs

Through a social investment fund, ADA has financing solutions that microfinance institutions (MFI) need to ensure their growth. For ADA, financial support from an institution is part of a long-term partnership complemented by a technical assistance program.

Discover the beneficiaries of the investment

Read more
News

March 2019

The portfolio in a few figures - Fourth quarter 2018

48 MFIs advised by ADA and financed by LMDF in 23 countries:

  • Latin America (57% presence)
    Mexico (SOFIPA), El Salvador (Optima, Padecom), Nicaragua (Fundeser, Fundenuse, Micrédito), Guatemala (ADISA, Fundap, Reficom), Honduras (AMC, FAMA, IDH, Pilarh), Haïti (ACME, Finca HT), Peru (Alternativa, Arariwa, CrediFlorida, Fondesurco, Norandino, Prisma), Ecuador (Faces, Insotec), Colombia (ECLOF), Argentina (FIE, OMLA, ProMujer)
  • Asia (16% presence)
    Cambodia (Maxima), East Timor (TRM, Moris Razik), Indonesia (Komida), Kyrgyzstan (Bailyk Finance, Oxus, Salym, Trust Union)
  • Africa (25% presence)
    Niger
    (ASUSU), Benin (Comuba, Pebco), Burkina Faso (ACEP), Côte d'Ivoire (PAMF CI), Morocco (AL Karama, AMSSF), Kenya (Letshego), Ghana (Sinapi Aba, Baobab), South Africa (SEF), Uganda (EBO, UMF), Sierra Leone (LAPO SL, ACTB S&L)

Outstanding loans: €28.7 million

Breakdown by subcontinent

February 2018

ADA is supporting ACEP Burkina Faso!

After a strong collaboration with ACEP group on risk management through technical assistance, ADA, through the investment fund LMDF, financially supported ACEP Burkina in February with a double operation of a 300K EUR subordinated loan and a 450K EUR senior loan. The subordinate loan aims to reinforce equity of ACEP Burkina in order to support its fast growth, while the senior loan aims to finance its portfolio growth needs.

Among the 25 poorest countries in the world and with an average age of 17 years old, Burkina Faso is a country with a very high rate of unemployment, especially among its youth. Most of the jobs held by the working population are informal and this population is often the target of a great number of MFIs in the form of cooperatives or associations that serve them by offering financial services in a more or less professional way.

In this panorama, ACEP Burkina stands as a professional MFI serving formal or informal SMEs by a specialized and dedicated methodology based on higher amounts and one flexible credit product especially dedicated to SMEs. ACEP Burkina belong to an international network of MFIs operating in five African countries: Senegal, Cameroon, Madagascar, Niger and Burkina Faso and led by ACEP International. ACEP’s philosophy is to solely target SMEs with the purpose to contribute to local economic development through creation of jobs, above all for young people, and boosting local production with a high value added.


31, January, 2019

Due diligence in Uganda

Olivia Fechner, our Nairobi-based Investment Officer, was in due diligence with EFC Uganda, a microfinance institution in Kampala focused on micro and small enterprises and missing middle.

Olivia EFC
ACEP Burkina Faso

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