YANGON — The Norwegian Investment Fund for Developing Countries on Tuesday agreed to invest in one of Myanmar’s first commercial-scale microfinance operators, company sources said.
Norfund will own 25 percent of Myanmar Finance International Ltd (MFIL,) a microfinance joint venture with Myanmar Investments International Limited (MIL) and its partner Myanmar Finance Co. Ltd., which will own 37.5 per cent each in the newly set up MFIL.
“Norfund injects USD 1.4 million into MFIL. Our total capital is USD 5 million,” said U Aung Htun, MIL’s Managing Director.
Norfund, a financial development institution owned by the Norwegian Government, was set up to combat poverty in selected countries through private sector development. One of the areas that it specialises in is microfinance.
“Norfund is an experienced investor in microfinance businesses in developing countries where they provide both equity and debt financing. We look forward to leveraging on Norfund’s experience in the sector,” U Aung Tun said. “Our philosophy is that it is perfectly possible to do good and make a profit.”
Microfinance in Myanmar is still in its infancy, as is the banking sector itself. Only about 5 per cent of the Myanmar’s population own bank accounts.
“Microfinance is important for the development of Myanmar,” said U Aung Htun. “I expect the market to grow. At the moment we have to employ our capital first. In the second stage we might have to attract capital from abroad.”