Catalyst Microfinance Investors (CMI) will provide US$ 125 million to one of Bangladesh's leading micro-finance institutions, ASA, to fund its rapid establishment and growth in Asia and Africa.
An agreement to this effect was signed recently between CMI and ASA, sources said.
The CMI has managed the fund from leading international institutional and private investors -- ABP, a Dutch pension fund, and TIAA-CREF, a US financial services organisation.
CMI is a private equity fund that invests in emerging, high potential micro-finance institutions, selected and managed by a team of globally renowned micro-finance practitioners and corporate finance specialists.
ASA International is one of the CMI's major investment vehicles, managed in partnership with ASA, which serves over 6 million micro-entrepreneurs from around 3,000 branches spread across the country.
Each of ASA International's micro-finance operations has adopted ASA's successful model of micro-finance, which is well recognised for its rapid scalability and low operating costs.
CMI and ASA International have already started operations in Cambodia, Ghana, India, Nigeria, Pakistan, the Philippines and Sri Lanka, and the organisations expect to commence operations in China and Indonesia within this year.
ASA President Md Shafiqual Haque Choudhury said there are an estimated 1 billion potential micro-finance clients around the world of which around 120 million are being served now.
He expressed hope that the fund will enable ASA to build and develop large-scale and highly efficient micro-finance institutions in developing markets around the world.
"It will also provide the poor in these regions, who have no access to banks or financial institutions, with credit and other basic financial services for the first time," he said.
The Asian Development Bank termed the ASA's 'cost-effective sustainable micro-finance model' as the 'Henry Ford Motor Model of Micro-finance'. Recently, ASA was recognised by Forbes Magazine as the world's most successful micro-finance institution.
As of December 31, 2006, ASA had a total loan portfolio of US$ 294 million, of which less than one percent was overdue, and retained earnings of US$ 196 million.
Its 6.5 million clients, of whom 5.2 million are borrowers, have been served through 2,931 branches by 18,400 staff members.