Microfinance Initiative For Asia - MIFA is the first ever microfinance initiative of its size to exclusively target the poor in Asia. MIFA's two main objectives are to create and enhance institutional capacity for sustainable microfinance delivery, and strengthen linkages with domestic and international capital markets.

• New Strategic partnership between KfW and IFC, the private sector arm of the World Bank Group, in collaboration with

• IFC and KfW jointly plan to commit up to US$1 billion through debt and equity investments, structured finance and advisory services to support Microfinance Institutions in Asia

• MIFA will focus on the following markets: China, India, and South, Central, and East Asia

MIFA Background: IFC and KfW have each been engaged in microfinance projects worldwide and coordinate their efforts very closely in many regions of the world through various initiatives (e.g., Microfinance Initiative for Sub-Saharan Africa - MIFSSA in Africa, ProCredit, European Fund for Southern Europe - EFSE and the Global Microfinance Facility - GMF). Although Asia has been at the forefront of establishing microfinance institutions (MFIs) in the past, the financing needs of micro-entrepreneurs in this region are largely unmet. In order to fill the large gap that exists today, IFC and KfW signed a Memorandum of Understanding on April 14, 2007 .

About IFC: IFC, a member of the World Bank Group, promotes open and competitive markets in developing countries.
IFC supports sustainable private sector companies and other partners in generating productive jobs and delivering basic services, so that people have opportunities to escape poverty and improve their lives. IFC’s Microfinance Unit works closely with KfW in other regional microfinance initiatives covering Sub-Saharan Africa and Eastern Europe. For more information, please visit www.ifc.org.

About KfW: KfW Entwicklungsbank (KfW development bank) finances investments and accompanying consulting services in developing countries. It carries out its work on behalf of the German government. Through its Financial Cooperation (FC) it contributes to reducing poverty, protecting natural resources and securing peace worldwide. For more information, please visit www.kfw.de.

MIFA Objectives:To fill the current gap in appropriate financing mechanisms and link MFIs to the capital markets, MIFA will provide capital support: (i) leveraging existing investment vehicles to provide equity and long-term local currency debt financing through partial guarantees; (ii) managing foreign exchange risks through currency swaps and other mechanisms; (iii) developing new investment vehicles in markets with less access to capital markets; (iv) accessing bond markets through credit enhancements; (v) assisting individual institutions with debt and equity financing.

Its main objectives are to: Create and enhance institutional capacity for sustainable microfinance delivery and Strengthen linkages with domestic and international capital markets

MIFA will focus on Central Asia, East Asia and the Pacific as well as South Asia (including Pakistan and Afghanistan) where IFC and KfW intend to jointly commit over US$950 million through debt, equity and structured finance projects over the next three to five years. MIFA will also leverage up to US$50 million in advisory services for Asian microfinance.