Grameen-Jameel guarantees expand access to local commercial markets for MFIs, with the following key features:
– Guarantees provided by Grameen-Jameel are US Dollar in the form of a Letter of Guarantee (LG) or a Standby Letter of Credit (SBLC), which are liquid with funds available against first demand. Minimum guarantee is USD 100,000 and maximum is USD 5 million, extended up to 5 years.
– The guarantee is used to leverage local currency financing by a local commercial bank for loan portfolio expansion (not working capital). MFI eligibility is subject to the following minimum criteria and conditional upon transactional due diligence and investment committee approval:
- Awards and/or industry reputation
- Impact study (internal or external)
- Low average loan size vs. in-country peers