Resource Center

FAQs

eNewsletter

Print Newsletter
• Summer 2008
• Fall 2007
• Spring 2007
• Fall 2006
• Spring 2006
• Fall 2005
• Spring 2005
• Fall 2004
• Summer 2004
• Spring 2004
• Winter 2004
• Fall 2003

Books and Publications

Client success stories

Annual Reports

Important Links

Newsroom

Video Room

Grameen Foundation : Resource Center : Print Newsletter : Spring 2006 : Growth Guarantee Generates $750,000

Spring 2006

In this issue... Half Million Equity in Indian MFI Growth Guarantee Generates $750,000 GFUSA’s Open Source Project Annual Fund Named Tsunami Survivors Rebuilding ”Village Phones” Connecting Uganda Nigeria Partner Gives Hope Letter From the President === Back to contents ===

Growth Guarantee Generates $750,000 for Tunisian MFI

Grameen Foundation USA (GFUSA) announced its innovative Growth Guarantees Program in September 2005. It is the organization’s largest financing program to date. The Growth Guarantees aims to pump a tremendous US$300 million in microfinance loans to benefit more than a million poor people around the world to help them start, sustain or grow their own businesses.

Besides the impact on the world's impoverished, the program is innovative for helping microfinance institutions (MFIs) minimize foreign exchange risk by issuing debt in local currency.

The program allows donors to pledge their assets as part of a pooled guarantee. Citigroup, GFUSA’s financial institution in the transaction, in turn issues stand by letters of credit to local commercial banks to support financing for MFIs selected by GFUSA. So far the program has raised a guarantee pool of $31 million against a goal of $50 million and now those guarantees will soon benefit microfinance institutions around the world and the people they serve.

The first guarantee was deployed in January 2006 for $375,000 (1 million Dinars) to ENDA, a microfinance institution in Tunisia.  ENDA has been able to leverage the guarantee two times to obtain a local currency loan of $750,000. The loan is estimated to help 5,000 more borrowers -- borrowers such as Emna. After a car accident left her husband unable to work, her husband’s business went bankrupt. Emna took an initial loan of $150 USD from ENDA and applied her sewing and embroidery skills to start a business out of her home.  Her clientele steadily grew.  Emna’s perseverance has paid off.  She now sells her products to numerous stores.  For her success, she was recognized by ENDA with an award of best microfinance client in 2005.

 For more information about the Growth Guarantees Program, visit www.gfusa.org/capitalmarkets

Grameen Foundation : Resource Center : Print Newsletter : Spring 2006 : Growth Guarantee Generates $750,000