Incofin's Rural Impulse Fund II takes stake in Pakistani Khushhali Bank

Incofin's Rural Impulse Fund II takes stake in Pakistani Khushhali Bank

2012/07/30

Incofin IM's Rural Impulse Fund II becomes shareholder of the Pakistani microfinance bank Khushhali Bank. A consortium, besides RIF II also consisting of the local commercial bank United Bank and the international microfinance investors Shorecap II, Triple Jump and ResponsAbility, takes a share of 67.4% in the bank. Khushhali was previously owned by 15 local commercial banks of which 11 sold their stake. Incofin IM will appoint a member in the board of Khushhali Bank.

Khushhali Bank, established in 2000, is the largest microfinance bank in Pakistan. It has a strong infrastructure network with more than 100 offices in 72 districts of the country. It counts more than 300,000 clients and a loan portfolio of USD 44 million.

Khushhali offers agriculture loans, livestock loans and enterprise loans. Most loans are non-collateralized group loans, and recently the bank also started providing individual loans. With almost 90% of the financing going to agriculture and livestock, Khushhali has a very strong rural and agricultural focus. As a microfinance bank, Khushhali can also offer banking, saving and deposit accounts. The bank plans to introduce new products, constantly striving to offer its clients better services.

This is Incofin's first investment in Pakistan, the sixth most populated country worldwide with over 185.5 million inhabitants. Unfortunately, over 30% of the Pakistani live below the poverty line and even less than 12% hold formal bank accounts. Pakistan’s microfinance sector is supported by a legal and regulatory framework that is considered to be the most formalized in South Asia.

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