Seattle-based Global Partnerships has announced the creation of a $20 million microfinance investment fund with the goal of significantly increasing access to small loans for individuals living in poverty in Latin America, including women and the rural poor.
Closed to additional investors, GP's Microfinance Fund 2008 will combine philanthropic giving with private capital, including investments totaling more than $18.5 million from forty-two individuals and groups such as the Overseas Private Investment Corporation, the Multilateral Investment Fund of the Inter-American Development Bank, and the Seattle International Foundation. Investors will receive a moderate financial return for investments ranging from $100,000 to $6 million.
The fund, the third established by GP, addresses several of the challenges faced by microfinance institutions in seeking growth capital by providing "patient" capital — funding over a longer term and at rates more competitive than those offered by conventional markets. In combination with the organization's previous funds, MFF 2008 will expand GP's support to more than thirty partners in Bolivia, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, and Peru.