The world's local bank
Microfinance
Our approach to microfinance is to concentrate on our strengths and to work with others rather than try to build expertise quickly in the short to medium term. Our aim is to create self-sustaining, stable financial services to help people out of poverty. We integrate microfinance activities with our local business capabilities rather than as a separate business line.
In 2005, HSBC hosted a United Nations discussion forum on microfinance to address the issues of financial services provision for people who do not qualify for traditional banking services. It was one of a series of international forums organised by the UN as part of the first officially designated Year of Microcredit. Supporting microfinance is one of the ways in which financial institutions can support the UN Millennium Development Goal of eradicating extreme poverty.
Since 2004 HSBC has been piloting a number of microfinance projects around the world. These projects vary from wholesale lending and credit lines to project support, cash management and foreign exchange handling.
Brazil
Plans to work with the Inter-American Development Bank to provide wholesale funding to Banco da Familia have not progressed because of regulatory issues. We remain committed to microfinance in Brazil and are investigating further opportunities.
India
HSBC India is currently working with seven microfinance institutions, across four provinces, providing microfinance to over 70,000 poor households in both rural and urban India. Over US$5.5 million in credit facilities have been approved to date. A debt financing programme called eMFI has been created to support small and promising microfinance institutions. Two emerging microfinance institutions have already been provided with credit facilities under this programme.
Mexico
HSBC works closely with Compartamos, one of Mexico’s largest microfinance institutions with a portfolio of loans of US$300 million and part of the Accion network. On the transactional side, we allow Compartamos’s clients to receive their loans and make payments in HSBC branches. This relationship is particularly beneficial to Compartamos’s 350,000 customers since HSBC has 1,400 branches, compared with Compartamos’s 60 offices.
Philippines
We continue our interest in wholesale lending and are currently reviewing proposals for commercial funding from three microfinance institutions in the Philippines.
Russia
We structured a US$20 million loan guarantee fund on behalf of Opportunity International (OI). This will be used to secure letter of credit facilities to enable OI’s partners in various countries to obtain local currency funding. The Opportunity International Loan Guarantee Fund provided a guarantee of US$1 million against credit facilities of US$2 million to Fund Opportunity Russia.
Downloads
2007 Sustainability Report
(39 page pdf 1,744K)
Useful tools
Increase font
Decrease font