Posted on June 18, 2008

Gates Foundation Awards $19.4 Million to Mercy Corps for Microfinance Project

Mercy Corps, a U.S.-based nonprofit that works to alleviate suffering, poverty, and oppression by helping people build secure, productive and just communities, has announced a $19.4 million grant from the Bill & Melinda Gates Foundation to expand access to financial services for Indonesia's poor.

Awarded through the Gates Foundation's Financial Services for the Poor initiative, the grant will support the Maximizing Financial Access and Innovation at Scale (MAXIS) project, which will work to create a commercial bank that partners with thousands of microfinance institutions (MFIs) in Indonesia. In turn, the bank will make it possible for MFIs to provide a range of products and services beyond microloans and savings accounts, including microinsurance, mortgage finance, and mobile banking.

Total funding for the bank and its programs is expected to reach approximately $33 million, with additional support to come from the International Finance Corporation, the Hivos-Triodos Fund, and other funders.

"With its many microfinance institutions, Indonesia is a good place to test whether linking diverse and small financial institutions together is a commercially viable and effective way to make savings, loans, and other products more widely available to the poorest people," said Bob Christen, director of financial services for the poor at the Gates Foundation. "Mercy Corps is well-positioned to move this innovative concept forward."