CFPA Equity II (IFC-38028)

Regions
  • East Asia and Pacific
Where the impacts of the investment may be experienced.
Countries
  • China
Where the impacts of the investment may be experienced.
Specific Location
Nation wide China
Whenever identified, the area within countries where the impacts of the investment may be experienced. Exact locations of projects may not be identified fully or at all in project documents. Please review updated project documents and community-led assessments.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Active
Bank Risk Rating
FI
Risk rating varies among banks and may refer only to the particular investment and not to the risk for the project as a whole. Projects marked 'U' have an 'Unknown' risk rating at the time of disclosure.
Voting Date
May 2, 2016
The estimate day the bank will vote on a proposed investment. The decision dates may change, so review updated project documents or contact the EWS team.
Borrower
CFPA MICROFINANCE MANAGEMENT LIMITED CO.
The holder of the loan, grant, or other investment.
Sectors
  • Finance
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Equity
The categories of the bank investment: loan, grant, etc.
Investment Amount (USD)
$ 25.00 million
Value listed on project documents at time of disclosure. If necessary, converted to USD$. Please review updated project documents for more information.
Project Cost (USD)
$ 25.00 million
Value listed on project documents at time of disclosure. If necessary, converted to USD$. Please see updated project documentation for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Jul 24, 2018

Disclosed by Bank Mar 28, 2016


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Project Description

The proposed project entails IFC’s additional equity investment of up to RMB160 million (US$25 million equivalent) in CFPA Microfinance Management Co., Ltd. (“CFPA MF”, the “Company”).

CFPA MF is a leading microfinance company dedicated to rural finance. IFC is an existing shareholder of the Company and also provided a RMB equivalent US$20 million five year senior loan to CFPA MF. Successfully transformed from a poverty alleviation project, the Company has experienced substantial growth with geographic expansion to 166 counties in 17 provinces, and with deep outreach to 306,101 active customers. By 2015, the outstanding portfolio of CFPA MF reached RMB2.6 billion (US$400 million), representing a five year CAGR of 46.3%. Given its proven track record and demonstrated development impact, IFC would like to continue to support the Company for future expansion.

Expected development impact
1. Promoting financial inclusion: IFC's investment will strengthen the capital of CFPA MF, enable it to leverage more resources and funding to support the geographic and portfolio expansion of the Company.
2. Creating opportunities for disadvantaged groups: As 97% of CFPA MF's customers are rural households with at most a middle school education, and over 90% of them are women, IFC's investment in CFPA MF promote financial inclusion for disadvantaged groups who are underserved and not covered by traditional financial institutions.

Investment Description
  • International Finance Corporation (IFC)

CFPA MF is currently sponsored by China Foundation of Poverty Alleviation (“CFPA Foundation”). CFPA Foundation was established in 1989 with a mission to alleviate poverty in China. The Foundation is regulated by the State Council Leading Group Office of Poverty Alleviation and Development (“CPAD”), and is currently the largest civil society organization working in the field of poverty reduction in China. At present, CFPA Foundation holds 62.7% stake in CFPA MF, with the remaining shareholdings held by IFC (19.2%) and Sequoia Capital (18.1%).

Private Actors

CFPA MF is a leading microfinance company dedicated to rural finance. CFPA MF is currently sponsored by China Foundation of Poverty Alleviation (“CFPA Foundation”). CFPA Foundation was established in 1989 with a mission to alleviate poverty in China. The Foundation is regulated by the State Council Leading Group Office of Poverty Alleviation and Development (“CPAD”), and is currently the largest civil society organization working in the field of poverty reduction in China. At present, CFPA Foundation holds 62.7% stake in CFPA MF, with the remaining shareholdings held by IFC (19.2%) and Sequoia Capital (18.1%).

Contact Information

Mr. Dongwen Liu
Chief Executive Officer
CFPA Microfinance Management Co., Ltd.
1st Floor, South Building, 36 Shuangyushu Xili, Haidian District, Beijing, China
+86-10-82872688
Email: liudongwen@cfpamf.org.cn

ACCOUNTABILITY MECHANISM OF IFC

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org. You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org/