Financial Service Providers (FSP)

• At least 5,000 borrowers or minimum gross loan portfolio (GLP) of $1M

• Capital Adequacy Ratio (CAR): ≥12% or Debt-to-Equity Ratio: ≤5.0x

• Portfolio-at-Risk (PAR) >30 plus Rescheduled Loans: <10%

• Write-off Ratio: <2%

• Operational Self Sufficiency: ≥100%

• Yearly audited statements

FSP Key Impact Criteria

MCE requires Financial Service Providers to have exclusion lists and client protection systems in place aligned with industry standards. Moreover, MCE prioritizes investments that meet the following criteria: 

• Local Economies: Enhances access to finance for underserved segments of the population and improves access to additional essential services such as education or health. Aims to generate economic opportunities and resilience for local economies.  

• Women: Proactively enhances access to finance and essential services for women. Presents a balanced workforce and client base. Preference for women-founded or women-led companies. 

• Environmental Resilience: Integrates mitigation and adaptation considerations in its strategy and offering. Preference for strong environmental resilience practices through relevant savings and insurance products, as well as non-financial services. 

• Client Protection: Demonstrated alignment with the Client Protection Principles and signatory of (or willingness to sign) the Client Protection Pathway.

Small and Growing Businesses (SGB)

Investment Strategy

• Sector: Agriculture value chain

• Geographic focus: Africa and Latin America

Company Profile

• > 2 years of operations

• Proven business model

• Sustainable and scalable sources of revenue >$1M/year and positive EBITDA (within 12 months of investment)

• Positive equity with reasonable debt-to-equity and debt service coverage ratios

• Audited financial statements for at least one year and quarterly financial statements

SGB Key Impact Criteria

MCE requires Small and Growing Businesses to have social and environmental protection systems in place and prioritizes investments that meet the following criteria:

• Local Economies: Generates local quality jobs and enhances income opportunities in rural areas. Works with smallholder farmers and, preferably, provides support to boost agricultural yields and price premiums.

• Women: Presents a balanced workforce and supply chain. Proactively enhances employment and income opportunities for women. Preference for women-founded or women-led companies.

• Environmental Resilience: Adopts sustainable agriculture practices through organic, regenerative and other techniques, and/or supports smallholder farmers in adopting them through Technical Assistance. Preference for strong adaptation practices.

Deal Structure

Financial service providers

• Size: US$350K- $4M

• Currency: USD, EUR, or local currency

• Pricing: 7.5 - 10% interest in USD

• Term: 2 - 4 years

• Capital: Senior debt

Small and Growing Businesses

• Size: US$300K - $1.5M

• Currency: USD, EUR, or local currency

• Pricing: 9 - 12% in USD

• Term: 12 months - 4 years

• Product: Senior working capital