Press Release: Accion, FMO and Triodos Investment Management Form Consortium to Strengthen Financial Inclusion in Myanmar

Tuesday, April 28, 2015

Financial inclusion pioneer Accion, the Dutch development bank FMO, and Triodos Investment Management today announced their plans to invest in and expand Dawn Microfinance, one of the earliest microfinance institutions (MFIs) established in the Republic of Myanmar. The $6.85 million investment is intended to establish the newly incorporated MFI as a premier institution that can serve as a model for the country’s nascent microfinance industry and influence the development of the sector.

Originally launched in 2002 as a program of Save the Children, Dawn is now a licensed microfinance institution, today serving approximately 30,000 clients with loans ranging from $50 to $250. It consists of 120 employees and 12 branches in four different regions of Myanmar.

Under the new structure, Accion will hold 40 percent of the new company and will serve as the operating partner; FMO and funds managed by Triodos Investment Management will each hold 30 percent. Save the Children will remain a strategic partner, with a role in governance. With a shared commitment to improving financial inclusion in Myanmar, the consortium members seek to rapidly increase the MFI’s outreach, as well as its product diversification.

Despite slowly-improving economic conditions, Myanmar remains one of the poorest countries in Asia. More than a quarter of the population of 51 million lives in poverty, with 80-90 percent lacking access to formal financial services. Of 187 countries in the 2014 UNDP Human Development Index, Myanmar ranks 150th.

“We are thrilled to enter Myanmar and to grow and expand financial inclusion,” said Accion CEO and President Michael Schlein. “In so doing, we can help the country emerge from decades of isolation and build a vibrant, inclusive economy. The demand for financial services throughout the country is booming and we believe we can help meet those needs. Over our history, we have helped to build 64 microfinance institutions in 32 countries and we are excited to bring that experience to Myanmar. Our goal is to provide many more entrepreneurs and families with the financial tools they need to realize their economic potential.”

“Myanmar is a country with great economic upside potential, waiting to blossom,” said FMO CEO Nanno Kleiterp. “Our combined efforts greatly contribute to improving the access to finance and will support the creation of jobs for many people.”

Femke Bos, Fund Manager, Triodos Microfinance Fund, said, “With this joint investment we are very much looking forward to being part of Dawn’s development and journey to expand its outreach. By doing so we can make a substantial contribution to improving financial inclusion in Myanmar.”

The consortium intends to strengthen Dawn’s operations by seconding senior staff; implementing new training and coaching programs; developing a wider range of products and services; establishing new HR and IT systems and internal controls; and prioritizing customer education and protection.

Accion, FMO and Triodos Investment Management will measure their collective success in Myanmar by both assessing Dawn’s performance and examining how the work’s ‘demonstration effect’ will encourage other financial inclusion leaders to invest in the country. The consortium anticipates that Dawn can serve as a role model for other microfinance institutions, helping to support and embed client protection, sound governance, financial literacy and social-performance management across the fledgling industry.

Source: Accion (link opens in a new window)

financial inclusion, microfinance