Press Release

MicroRate and M-CRIL –announce the creation of a global alliance called, MicroRating International (MRI).

MicroRate and M-CRIL – the two largest microfinance rating agencies in the world – announce the creation of a global alliance called, MicroRating International (MRI). The two agencies pioneered the rating of microfinance institutions (MFIs) and have evaluated over 400 MFIs globally. Together, they represent by far the largest pool of microfinance rating know-how in the world, covering over 70% of the microfinance ratings conducted globally.

This alliance combines the strengths of M-CRIL and MicroRate to offer a standardised rating product that spans the globe from Bangladesh and Bosnia to Benin and Bolivia. It is the first step towards a merger of the two companies.

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MFInsights

Role Reversal: Are Public Development Institutions Crowding Out Private Investment in Microfinance?
 
The rapid growth of foreign private lending to microfinance institutions (MFIs) in the last several years has led to a surprising reversal of roles between government-owned development institutions and private lenders. Development institutions (International Financial Institutions -“IFIs”) are concentrating their loans in the strongest MFIs, leaving private lenders to look for opportunities among smaller, riskier borrowers.

Development institutions are “crowding” private lenders out of the best MFIs. In the last three years, the volume of international private lending has exploded: in 2005 alone, outstanding loans doubled to nearly $1 billion. IFIs publicly claim to take risks the private sector is unwilling to take. One would therefore have expected government-owned development institutions to shift their lending to more risky MFIs as soon as private lenders entered the field. The opposite is happening. Development agencies are today heavily concentrating their funding in the largest and most successful MFIs, exactly the target investment market of private investors.
pdf (Read More in MicroRate’s latest MFInsight)