An innovative partnership
It is difficult to understand LMDF without considering its initiator, promoter, shareholder and investment adviser Support for Autonomous Development asbl (ADA).
ADA is the leading non-governmental organisation in Luxembourg, active in microfinance and inclusive finance. The ADA LUXMINT funding program started in 2000 and served as a test program to illustrate the potential of debt, collateral, and equity in microfinance institutions. LUXMINT financed 19 MFIs in Asia, Africa and Latin America and part of the investment portfolio was allocated to LMDF when it was incorporated in late 2009.
ADA has a team exclusively dedicated to LMDF, but the NGO is much more than just an investment adviser. ADA is active in the development of microfinance institutions through innovation, capacity building and peer-to-peer learning, as well as in sector-level interventions that meet regulatory or legal benchmarks. ADA also has specific expertise in West Africa. Their work as investment advisers’ benefits from synergies through the information and networks that other activities create.
Although unusual, at first glance, the partnership between a regulated investment fund structure and an NGO only makes sense if we consider the complementarity of skills necessary to balance shareholders’ expectations with the objective of extend financial services to benefit marginalised communities and people.