CFPA Equity II (IFC-38028)

Regions
  • East Asia and Pacific
Geographic location where the impacts of the investment may be experienced.
Countries
  • China
Geographic location 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
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
FI
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
May 2, 2016
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
CFPA MICROFINANCE MANAGEMENT LIMITED CO.
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
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, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 25.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. 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, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS May 6, 2019

Disclosed by Bank Mar 28, 2016

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed 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
Here you can find a list of individual development financial institutions that finance the project.

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%).

Financial Intermediary
A financial intermediary is a bank or financial institution that receives funds from a development bank. A financial intermediary then lends these funds to their clients (private actors) in the form of loans, bonds, guarantees and equity shares. Financial intermediaries include insurance, pension and equity funds. The direct financial relationship is between the development bank and the financial intermediary.
Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

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
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

The Project Contact

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/

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How it works