Dutch Offer

The members of NpM, Platform for Inclusive Finance, have committed $2.1 billion to the inclusive finance sector as of December 2010. The total amount of foreign capital worldwide is estimated at $25 billion, implying that the Dutch share in inclusive finance investments is around 8.4 percent. The Dutch support benefits almost 500 organisations around the world, reaching approximately 50 million clients.

Our database 'Funding Figures' gives insight into the funding of inclusive finance projects per member, country and region.

Regional allocation

The members of NpM are active in over 90 countries around the world. The largest share (31 percent) of the members’ funds goes to Latin America and the Caribbean (See figure 2.1). This region is one of the most developed microfinance regions in the world, with many microfinance institutions (MFIs) reaching large scale. Europe and Central Asia are the second largest recipient region of Dutch investment (22 percent). Within the Middle East and Northern Africa the microfinance sector is still small, which explains the limited activities of the members there. In Sub-Saharan Africa the microfinance sector is evolving rapidly in several countries and many African countries are actively introducing regulations in order to create a more enabling environment. However, various risks such as political instability and high operating expenses  affect funders’ considerations to invest in these countries.  

Figure 2.1: Regional allocation of Dutch investments (in % of $ committed)
     
Source: A Billion to Gain. ING – NpM publication, 2012.

The countries  receiving most of the Dutch funding are India (11 percent), Peru (7.3 percent) and Cambodia (6 percent). The NpM members are active in over 65 percent of the 40 low-income countries in the world to which they allocate 24 percent of their funds. This is considerably higher than other foreign funders (16 percent).  

Funding instruments

The funding instrument mostly used by the NpM members is debt. Together with equity funding, these instruments represent 93 percent of the Dutch portfolio in comparison to 78 percent for the rest of the world (see figure 2.2). It is expected that equity funding by NpM members will increase in the future since there is a need for microfinance institutions (MFIs) to improve their solvency while scaling up investments.  

Figure 2.2: Funding instruments (in % of $ committed)
Source: A Billion to Gain. ING – NpM publication, 2012.


The information provided in ‘Dutch offer’ has been based on the joint ING-NpM publication ‘A Billion to Gain’.