Interview with Nordic Microfinance Initiative (NMI)

 

The “dream” – how it started

Mr. Johan H. Andresen, Chairman and owner of Ferd, had the idea of what was to become Nordic Microfinance Initiative (NMI) during World Economic Forum in Davos in 2004. He later wrote the Norwegian Prime minister Mr. Jens Stoltenberg and shared the idea of a Public-private partnership investing in microfinance institutions in developing countries. As Mr. Muhammad Yunus and Gremeen Bank were awarded the Nobel Peace Prize in 2006, microfinance clearly came in the spotlight, and NMI was founded with joint private and public forces in 2008.

 

Area of focus

NMI invests in microfinance institutions, operating in target countries in Africa and Asia.

NMI’s vision is to contribute to the empowerment of poor people in developing countries and to the creation of jobs and wealth on a sustainable basis. We accomplish this by investing in and building up microfinance institutions, which especially target poor women in developing countries. NMI combines existing experience in the field of microfinance and international development cooperation, with the capital strength and financial experience of institutional investors.

 

 

Challenges in the geographical areas of influence

In addition to political and country risk, microfinance is by nature a cost intensive model; targeting low-income clients who typically live in rural areas and have no collateral. Innovative use of fintech will help to reduce OPEX and increase outreach.

 

Co-operation and partnerships

NMI has a strong and unique investor base through Norfund and IFU (Norwegian and Danish governmental funds for developing countries) and private sector institutions DNB, Ferd, KLP, Storebrand and TD Veen.

The Norwegian Ministry of Foreign Affairs and Norad are crucial partners: Competence building for local MFIs through NMI’s Technical Assistance Facility, sponsored by Norad. In additioon, hedging through NMI’s Foreign Exchange Loss Facility, sponsored by Norfund.

 

Successes

NMI has a long-term investment profile, and one example is Indian Fusion Microfinance, which during NMI’s ownership (2013-2015) grew its client base from 60,000 to 1.3 million.

Other examples include NMI’s investee RGVN (North East) Microfinance Limited, which in 2018 was granted Small Bank license from Reserve Bank of India for setting up North East Small Finance Bank Limited.

 

About the Nordic effort

NMI is proud to be a successful Public-private partnership crossing both the Public-Private border as well as the Norway-Denmark border.

 

The Financial Inclusion Summit takes place in Oslo, Norway, on 28 March 2019. To find out more or request an invitation, visit: https://financial-inclusion.com/#register

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