Support for Businesses and Communities: COVID-19 Resources from our Microfinance Portfolio Partners

Supporting microentrepreneurs and small businesses, those that form the foundation of economies around the world, is now more important as ever. While many micro-enterprises are hurting as a result of the coronavirus pandemic and related lockdowns, these same businesses will ultimately form the basis of a strong recovery. Our portfolio partners, microfinance institutions across the globe, are working diligently to ensure that the needs of their clients are met, and that financial inclusion continues to progress even in the face of the pandemic. We are inspired by the commitment to coordination and partnership that we have seen in response to the coronavirus across the microfinance and financial inclusion sector globally.

Calvert Impact Capital and our partners are committed to supporting both investors and communities in creating near-term and long-term solutions to the crisis. While this blog is focused on highlighting relief efforts from our partners in the microfinance sector, all our portfolio partners are working hard to support their communities. We will continue to share efforts from our portfolio partners working in a range of sectors and geographies in the coming weeks.

COVID-19 Resources from some of our Microfinance Portfolio Partners:

BlueOrchard, responsAbility, Oikocredit, Microvest: A group of nine leading microfinance investors, including our portfolio partners BlueOrchard, responsAbility Investments, Oikocredit, and Microvest, have signed a Memorandum of Understanding (MoU) for coordination in response to COVID-19 across frontier and emerging markets. The MoU aims to coordinate efforts in the provision of ongoing refinancing in a responsible manner, enabling these institutions, and the microfinance sector at large, to adequately respond to temporary changes in business conditions.

BlueOrchard: BlueOrchard is collaborating with other investors on a new fund to provide funding for micro, small, and medium-sized enterprises (MSMEs) in emerging and frontier markets that have been affected by the Covid-19 pandemic. The fund will support financial institutions and their portfolio companies by providing flexible financing schemes that limit disruption to businesses, maintain jobs, and re-establish a path to growth. Additionally, the BlueOrchard UCITS Emerging Markets SDG Impact Bond Fund (IBF) has invested into a social bond from the International Finance Corporation (IFC), which aims to maintain jobs and reduce the economic impact of the pandemic in developing countries.

BlueOrchard’s investments team has also published insights on the impact of Covid-19 on microfinance investing.

FINCA Impact Finance: Under the leadership of Andrée Simon of FINCA Impact Finance, a new coalition has been created to raise the profile of microfinance organizations as critical players in the response to the unfolding COVID-19 crisis. This coalition of organizations seeks to create a cohesive voice and response to COVID-19 amongst microfinance institutions that provide financial services to the world’s poor. Additionally, Seth Spiro, Senior Director of Marketing and Communications at FIF authored a blog on customer communications in the microfinance sector during COVID-19. He outlines the main principles guiding FIF’s proactive and personalized branchless strategy during the pandemic and seeks to provide examples of communication that are illustrative and helpful for other financial service providers to strengthen customer relationships during this time. Calvert Impact Capital’s recently closed loan to FINCA Impact Finance will directly finance their global COVID-19 response.

Global Communities: In response to the pandemic, Global Communities has created an online interactive map outlining their COVID-19 responses by portfolio country. For example, in Honduras, Global Communities is shifting its work on malaria and TB prevention to support the procurement of medical supplies and equipment to support the COVID-19 response. In Yemen, their efforts around COVID-19 leverage strong collaborative relationships with communities and their leaders to encourage positive, healthy behaviors and support local and national governments to coordinate and roll out locally led responses. See the interactive map to learn more about their responses in other countries.

Grameen America: All Grameen America branches have implemented a virtual model of program delivery to support the 52,000 women entrepreneurs they serve. All weekly member meetings will be held virtually, loan repayments will be repaid digitally, and all new loan disbursements will be made digitally, via disbursement cards. Additionally, Grameen America is lowering the interest rate on existing loans to 0%, offering loan extensions to members who are unable to make their weekly repayments, and covering all member costs to digital repayment vendors to support safe, virtual operations. Finally, they're raising a $72 million Economic Relief and Recovery Fund, which will help support Grameen's adapted financing model during this time of great need.

MCE Social Capital: At the initiative of Grameen Credit Agricole Foundation, a group of microfinance lenders and key players in inclusive finance, including MCE Social Capital, created a set of principles to better support the microfinance sector during the covid-19 pandemic. This pledge, entitled “Key principles to protect microfinance institutions and their clients in the Covid-19 crisis” aims to guide lenders and other stakeholders to better support microfinance institutions during this time. The fundamental principles of this pledge are pooling available information, analyses, and anticipations, as well as the concerted implementation of shared decisions to help microfinance face this crisis.

Oikocredit: In response to the pandemic, Oikocredit has created a Coronavirus Response page where it has resources for partners, Oikocredit news related to Covid-19, and responses to Frequently Asked Questions. They published a blog highlighting their efforts to support partners during this time, including their launch of a webinar series entitled Staying Ahead of Corona: Scenario Building and Stress Testing and a curated list of resources for partners. Additionally, alongside other members of the Dutch Platform for Inclusive Finance (NpM) Oikocredit signed the Covid-19 Investor Statement, which has been issued by impact investors in emerging markets. Finally, the Oikocredit International Support Foundation (ISUP) is contributing € 25,000 into a coronavirus solidarity fund, which will support end clients of Oikocredit’s microfinance partners in meeting the new regulations that would allow their businesses to stay open (such as purchasing sanitation equipment).

responsAbility: In addition to signing onto the Memorandum of Understanding (MoU), “Coordination among MIVs in response to Covid 19”, alongside our other portfolio partners, responsAbility has been active in publishing insights relevant to microfinance and covid-19. Some of their blogs include, “Actions to Mitigate the Covid-19 Crisis,” “ESG Briefing: Covid-19 Strengthens the Focus on ‘S’ Factors,” and “Now More Than Ever: Impact Investments in Emerging Markets.”

Please see our portfolio list to learn more about our other microfinance borrowers.

For updates from some of these portfolio partners in real time, follow them on Twitter: @BlueOrchardLtd, @responsAbility_, @OikocreditUS, @Microvestfund, @FINCAImpact, @G_Communities, @GrameenAmerica, @Mcesocap