Dutch development bank FMO has proposed a $7.5 million investment in BRAC Myanmar Microfinance Company Limited (BRAC), a Myanmar-based for-profit institution, according to its disclosure.
The investment follows the $2.5 million funding in 2018 that was provided by MASSIF, the financial inclusion fund that FMO manages on behalf of the Dutch government.
BRAC, a wholly-owned subsidiary of BRAC international holdings BV, provides micro and small-scale loans, small enterprise loans, agri loans, and loans to people with disabilities.
The microfinance institution, which started operation in 2014, has a strong focus on supporting women, 98 per cent of the 137,000 clients that they serve are women. The bank’s loan portfolio amounts to over $33 million as of June 2020.
FMO said the investment will be used to give BRAC the capability to further provide micro and small scale loans to underserved women in peri-urban areas of Myanmar.
“This loan is highly inclusive and supports FMOs strategy because the funds will go to financially underserved women in the peri-urban areas in Myanmar, a low-income, fragile state,” the development lender said in the disclosure.
Most recently, FMO committed $15 million in Myanmar’s Pact Global Microfinance Fund (PGMF), a wholly-owned subsidiary of Pact Inc, is the largest microfinance institution in Myanmar, holding more than 27 per cent stake of the market share.
Earlier, the Dutch impact investor proposed a $3-million investment in Maha, a deposit-taking financial service provider (licensed MFI) operating in rural areas of Myanmar, to further support Maha in reaching out to its farmers and small business owners in the rural area of the country.
In August, FMO committed a total of $33.3 million to businesses that operate in Asia’s developing economies that are expected to be hit hard by the pandemic.
The commitment was part of the more than $300 million that the impact investor allocated to companies globally as part of its business continuity program in the wake of the COVID-19 pandemic.
