July 26, 2018

MicroVest Sees Microfinance Shifting to Small Business

By Abby Schultz | July 26, 2018 | Barron’s PENTA

Microfinance—the business of investing in financial institutions that make loans to low-income entrepreneurs in developing countries—is a form of investing for social good that long predates the decade-old impact investing market.

Today, microfinance is a key part of many impact portfolios, representing 9% of assets held by impact investors surveyed by the Global Impact Investing Network, or GIIN.

But for MicroVest, a 15-year veteran fund manager in the sector, the practice of investing in microfinance institutions is shifting from “classic” microfinance—providing loans to individuals selling vegetables at a local market, for example—to investing in small businesses, a sector MicroVest says is often under-served.

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