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Survey results from Professionals involved in Microfinance Investments. Availabel for download. Learn more at www.microfinancesummit.com
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Microfinance Investment Summit Survey
http://www.microfinancesummit.com/
Question 1
Evaluating the growth and rate performance of microfinance as an asset
class- have microfinance investments performed better than expected
during the global economic crisis?
Top Representative Responses
1. The global economic crisis has affected the performance of
microfinance. However, microfinance demonstrates strong tendencies to
impact more people than banking.
2. yes, generally microfinance investments have proven to be less risky,
but still are not as high-yielding as other investments, and yes they have
performed better than expected
3. Yes, to my knowledge, at least in South Asia.
Question 2
How have liquidity constraints affected investments in terms of funding,
lending, and overall sustainability?
Top Representative Responses
1.Liquidity constraints are real and present in Africa. There must be
improvement in liquidity for microfinance achieve significant results.
2. Less commercial funding seems available but grant funding is still there.
Sustainability depends on geography. Where we are active in Zimbabwe
this has been huge problem.
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3. Funds are still available for deserving projects, although there has been
some slow down of investments , but not much.
4. Force MFIs to take higher FX risk or less favorable terms, but most MFI
liabitilites are 3-2 year term
© C5 Communications Ltd.
Microfinance Investment Summit Survey
http://www.microfinancesummit.com/
Question 3
Overcoming the challenges attributed to microfinance mergers and
acquisitions. Which of the following is top priority?
Percentage
Due Diligence and valuation 30.00%
Resource constraints 35.00%
Cultural Issues 15.00%
Regulatory issues 20.00%
0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% 35.00%
Due Diligence and valuation
Resource constraints
Cultural Issues
Regulatory issues
© C5 Communications Ltd.
Microfinance Investment Summit
http://www.microfinancesummit.com/
Question 4
What kinds of risks are being increasingly
monitored in microfinance now?
Least Moderate High
Refinancing risk 20% 20% 0%
Exchange rate risk 20% 20% 0%
Liquidity risk 0% 0% 60%
Interest rate risk 0% 20% 10%
Asset rate risk 20% 5% 10%
Risk of fraud at the local level as MFI's grow 30% 10% 20%
Quality of corporate governance. 10% 30% 0%
Total 100% 100% 100%
0% 10% 20% 30% 40% 50% 60%
Refinancing risk
Exchange rate risk
Liquidity risk
Interest rate risk
Asset rate risk
Risk of fraud at the local level as MFI's grow
Quality of corporate governance.
High Moderate Least
© C5 Communications Ltd.
Microfinance Investment Summit
http://www.microfinancesummit.com/
Question 5
How important is Social Impact Investment to your company?
Top Representative Responses
1. It is Fundamental to its long term growth and sustainability.
2. Important, but not as important as yield.
3. Social impact is the "heart" of what we do.
Question 6
Which approach do you currently apply for SME finance?
Percentage
Collateral based lending 35%
Information based lending 35%
Viability based financing 20%
Cash flow lending 10%
0% 5% 10% 15% 20% 25% 30% 35%
Collateral based lending
Information based lending
Viability based financing
Cash flow lending
© C5 Communications Ltd.
Microfinance Investment Summit
http://www.microfinancesummit.com/
Question 7
What impression does Environmental, Social, and Governance (ESG) reporting have
on funds and the double bottom line mission of microfinance?
Top Representative Responses
1. ESG reporting is taken into consideration, but its impact is not assessed yet.
2. This is an important factor for giving trust and it has a positive effect
3. SRI's are still growing. Information must be available in different ways by different
types of investors to meet their specific goals and needs.
4. There is a growing demand for ESG reporting. A postive effect of ESG reporting is
greater transparency. ESG reporting will continue to improve in quality. It makes
reporting and performance more comparable
Question 8
Do you plan to increase your exposure to microfinance investments in 2010 and
beyond?
Percentage
Undecided 20%
No 5%
Yes 75%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Undecided
No
Yes
© C5 Communications Ltd.