IFC to provide equity upto $1.15 million to help Hand in Hand Build Microfinance Capacity for women

New Delhi - November 12, 2009: IFC, a member of the World Bank Group, will work with Belstar Investment and Finance Limited, Hand in Hand's microfinance arm, to help establish a sustainable microfinance operation for the poor in rural and semi-urban areas and reach as many as a million women in the next five years. Hand in Hand is a non-governmental organization engaged in reducing poverty by creating enterprises and jobs.

IFC Executive Vice President and CEO Lars Thunell signed an agreement with Belstar in Kaancheepuram district of the Indian state of Tamil Nadu to provide equity of up to $1.15 million to support this initiative. IFC's equity funding will enable Belstar to obtain support from international investors, domestic banks and financial institutions.

Belstar's product offerings will focus on low-income households that are unable to access such services from commercial banks. Apart from microfinance, Hand in Hand provides training and advisory support to its women members engaged in micro-enterprises in India and helps them build linkages with larger corporations to make their operations more sustainable.

Percy Barnevik, Chairperson of Hand in Hand International, said, "In its efforts to strengthen and scale up its operations, Hand in Hand seeks to work with experienced partners that can provide technical and financial support. IFC is one such key partner for us."

In addition to the funding, IFC Advisory Services will help Belstar put in place risk management and internal control systems while improving staff training, broadening the company's product range and building a sustainable microfinance institution.

"IFC's participation and support in this transformation will be crucial to our sustainability and ability to attract other domestic and international investors," said Kalpana Sankar, Belstar's Managing Director.

Since the early 1990s, IFC has been instrumental in the rapid growth of microfinance around the world by providing advisory services and direct and indirect investment services. IFC's global microfinance portfolio as of June 30, 2009 is $1.2 billion, invested in over 140 microfinance institutions in 60 countries.

IFC Executive Vice President and CEO Lars Thunell, said: "Supporting microfinance institutions is an important step toward creating economic opportunities for the poor. Through our work with Belstar, we will bring financial services to underserved people in India, particularly women entrepreneurs in rural areas."

IFC is the only international financial institution focused exclusively on the private sector, the engine of sustainable development in emerging markets. Along with IBRD, it is currently seeking a capital increase to strengthen its ability to create opportunity for the poor in developing countries-including by supporting microfinance institutions benefiting small women entrepreneurs in India.

To learn more about IFC's activities in South Asia, visit www.ifc.org/southasia.

Source : Equity Bulls

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