responsAbility presents the Microfinance Market Outlook 2013
High debt? Low growth? Not here!
Zurich, 5 December 2012 – responsAbility, one of the world’s leading private investors in the area of development-related financing, presents the third successive edition of its annual Microfinance Market Outlook. The central message for 2013 is that solid return potential, sustained low volatility and a contribution to social development in the investment countries will continue to create a positive outlook in microfinance investments.
The global microfinance sector grew by almost 20% in 2012, and there is a strong indication that this trend will continue in 2013. While the industrialized nations are likely to stagnate for the third year in succession, developing and emerging countries remain attractive due to their consistently dynamic economic growth: according to the International Monetary Fund, gross domestic product across the 15 most important microfinance markets will increase by 6.2 per cent in real terms in 2013.
Global demand for refinancing for microfinance institutions continues unabated. Besides South and East Asia, African microfinance markets are also growing rapidly thanks to factors including technological progress such as payment transactions via cell phone. On the investment side, debt investments dominate with a total volume of around USD 4 billion. Interest in equity investments is increasing constantly, however, with their volume having doubled to around USD 1 billion since 2008.
Microfinance institutions can attribute their stability to the fact that 96 per cent of the loans granted are repaid on schedule. According to the experts interviewed for the Microfinance Market Outlook, the greatest threat for the institutions is government interference. Professional monitoring of country risks and broad diversification are effective safeguards for investors.
Christian Etzensperger, Senior Research Analyst and author of the study, explains: “While the performance of listed emerging market shares has again been disappointing in 2012 and yields on emerging market bonds have fallen to historic lows, we have achieved good results by directly managing unlisted debt and equity investments.”
responsAbility Investments AG
Ulli Janett, Media Relations
Telephone: +41 44 403 06 33
ulli.janett [at] responsAbility.com (e-mail: )