Jun 03 2009 |
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A first for Syria - Grameen-Jameel Joins Hands with Aga Khan Agency for Microfinance
Damascus, June 3, 2009: Grameen-Jameel, a social business that serves the Arab microfinance industry, has announced it has facilitated a multi-million dollar credit facility for the First Microfinance Institution (FMFI) Syria, part of the Aga Khan Agency for Microfinance (AKAM), to help improve the lives of 2,700 underprivileged Syrians through credit, deposits and other financial services.
Under the financing scheme, Grameen-Jameel issued a guarantee to support US$2.7 million in local currency financing (125 million Syrian Pounds). The guarantee backed a commercial overdraft facility disbursed by Bank Audi Syria, the first commercial bank to lend to the microfinance sector in Syria.
"We are proud to collaborate with the Aga Khan Agency for Microfinance, who is renowned in the Arab region and globally for its leadership in serving the less privileged," says Zaher Al-Munajjed, Chairman of Grameen-Jameel. "We hope this is the beginning of a constant collaboration between our two organisations."
Although this is Grameen-Jameel's first deal in Syria, the company has closed, to date, around US$20 million in partial credit guarantee transactions. The guarantees have been leveraged 2.2 times on average to raise US$44 million in total commercial financing for its partner microfinance institutions.
"This financing will support our ambitious outreach plan," says Jean-Lorenz Ehrentrant, CEO of FMFI. "Together with Grameen-Jameel we aim to empower the underprivileged to start their own business."
In November 2007, laws were introduced that allowed for the establishment of non-bank financial institutions (NBFI) and FMFI is the first microfinance institution to receive a license under these new regulations, which allows for savings mobilisation through deposits. Syria is the first country in the Arab region to enable the formation of NBFIs through a legal framework.
Ehrentrant added, "As part of our social responsibility strategy, we will bear the risk of providing them with loans to unleash their entrepreneurial potential, expand their staff base and ultimately improve the lives of even more people."
With poverty remaining a critical problem in the Arab world, microfinance targets the 75 million people in the region who live on less than US$2 a day by providing them with access to financial services. Grameen-Jameel is currently working with 11 MFI's in 7 Arab countries to help them increase the breadth and depth of their outreach.
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About Grameen-Jameel
Grameen-Jameel is a social business established in 2007 as a joint venture between Grameen Foundation and Bab Rizq Jameel Limited, a subsidiary of
Abdul Latif Jameel Group
. The company alleviates poverty in the Arab World through forming strategic partnerships with microfinance institutions and providing technical and financing support through its guarantee program. To date, Grameen-Jameel has facilitated local currency financing of US$44 million backed by US$20 million in guarantees to its partners. Grameen-Jameel has reached more than 360,000 new microfinance clients through its partners in Morocco, Tunisia, Egypt, Lebanon, Jordan, Palestine, Syria and Yemen.
About First MicroFinance Institution Syria
First MicroFinance Institution (FMFI) Syria is a limited joint stock company and obtained its operational license on August 25, 2008 from the Central Bank of Syria under the new regulatory framework announced in November 2007. The aim of FMFI is to be recognised as the leading microfinance services provider throughout Syria by contributing to poverty mitigation and economic growth through the provision of sustainable financial services primarily targeting the micro and small businesses as well as households.
About Aga Khan Agency for Microfinance
Since its establishment in 2005, the Aga Khan Agency for Microfinance has brought together over 25 years of microfinance activities, programs and banks that were administered by sister agencies within the Aga Khan Development Network. The underlying objectives of the agency are to reduce poverty, diminish the vulnerability of poor populations and alleviate economic and social exclusion. AKAM is a not-for-profit, non-denominational, international development agency created under Swiss law. Its headquarters are in Geneva, Switzerland. It is governed by an independent Board of Directors. The Chairman of the Board is his Highness the Aga Khan.
For more media information, please contact Ian Hainey on +971 50 466 1368 or ianhainey@hotmail.com.
© Press Release 2009
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