NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Tuesday, July 20, 2010

ACCION International’s Frontier Investments Group is a double bottom line, venture equity fund focused on catalyzing a new approach to microfinance. It invests in new technologies and disruptive business models that can powerfully enhance the way financial services are delivered to the poor. Building upon microfinance’s success in “banking the unbanked”, Frontier Investments looks for breakthrough innovations that will radically enhance the efficiency, reach and scope of financial services at the base of the economic pyramid.

Frontier Investments’ vision is to bridge the gap between purely philanthropic and for-profit investing. In an exclusive interview with Microfinance Focus, the Managing Director, Frontier Investments, Monica Brand discussed some of the emerging sectors that have the potential of bringing breakthrough innovations infinancial inclusion and are drawing interests from investors.

Microfinance Focus: Can you tell us about some of the investments you are doing?

Monica Brand: Frontier Investment was created by ACCION because we realized that there were certain limits of the current microfinance business models. Actually the very things that make microfinance successful are also the things that constrain it as well. For example being very high touch models or being very locally focussed. These are the parts of the success as well as the limitations. So Frontier was created to invest in the sectors what we call the adjacencies around microfinance which we think can unleash new business models and can help radically reduce cost and can expand the quality of financial inclusion.