First Pakistan Microfinance Fund
To bring a systematic change in the MFI industry of Pakistan by connecting the local capital markets with the intermediate sized microfinance institutions to meet their needs of local currency, scaled, and long-term financing. This in turn will promote growth of this sector and the country by directly impacting financial inclusion, women empowerment and employment rates.
|FIRST PAKISTAN MICROFINANCE FUND|
|Investee Companies||Pool of 6 to 8 Intermediate Sized MFIs|
|Issue Size||PKR 5 Billion or US$ 36 Million|
|Security||Secured by the Proportionate Receivables of Each Investee|
|Drawdown Period||1 Year in Four Equal Disbursements|
|Guarantee||10% Cash Reserve from each MFI (PKR 500mn), 2% in Second-Loss (PKR 100mn), and 18% in Third-Loss protection (PKR 900mn).|
|Listing||This fund issued in the form of TFC will be listed on Pakistan Stock Exchange|
|Credit Rating||The overall structure will be rated by the rating agency.|
|Pricing||3 Month KIBOR + (3.5% – 4%) p.a. Varying based on the risk categorization of MFI|
Structure of the Fund
The First Pakistan Microfinance Fund would result in connecting some larger financial players in the Pakistan’s thriving capital markets including Arif Habib (largest broker dealer), leading commercial banks and other investors, with the intermediate sized MFIs.