Mr. Edwin Salonga is one of the nine (9) selected speakers at the international conference on Global Partnerships in Microfinance. The conference is organized by the University of Greenwich, in collaboration with the University of Birmingham and Burgundy School of Business. Mr. Salonga is the Chief Executive Officer (CEO) of the Social Enterprise Development Partnerships, Inc. (SEDPI) and a concurrent lecturer at the Ateneo de Manila University’s Development Studies Program.
The conference will be held on 6-7 September 2010 at the University of Greenwich in London. The event will be graced by Her Royal Highness Princess Máxima of the Netherlands as a guest speaker. The conference intends to look at all potential partnerships in microfinance and to discuss their accomplishments in meeting the microfinance goals. The conference will focus on the following topics a) Strategic Partnerships; b) Enhance New Partnerships; c) The Role of Institutions Involved; d) Collaborative Relations; and e) Global versus Local Partnerships.
The paper of Mr. Salonga is entitled “Fund Guarantees with Clear Exit Strategy: Donors Building the Confidence of Commercial Banks in Funding Microfinance Institutions.” It delves on how the partnership of international donor agencies and commercial banks may support the operations of microfinance institutions (MFIs). One of the major challenges of MFIs is access to commercial funds to increase their loan portfolio, which in turn will be utilized to carry out their mission to reach out to more poor people. However, commercial banks view microfinance as a risky investment due to the traditional banking approach they are more familiar with. It is in this context that international donors at present establish partnerships with commercial banks to build the confidence of the latter on microfinance through a risk-sharing mechanism by virtue of fund guarantees. It is through this scheme that a portion of the funds released by commercial banks to MFIs is guaranteed by the donors. In case that the MFIs fail to pay off their loans to the commercial banks, the respective donors would cover such payments. The challenge however for the donors is to map out a clear exit strategy, in terms of timeframe or milestones, that the MFIs need to observe as this guarantee scheme is a financial intervention that will have to be discontinued over time.
To learn more about the conference, click here.
SEDPI is a member of INAFI Philippines
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