Financial Support

GT started supporting microcredit initiatives since 1989 when the poverty fighting capacity of microcredit was not well recognized and when Microcredit Programs (MCPs) had no access to financial institutions. Given the success of Grameen Bank in reaching the poor, providing them with financial services, developing sustainable MCPs and helping them overcome poverty in this process, a lot of people and organizations committed to poverty alleviation became interested in Grameen replication. In response to this, GT came forward with its program of financial assistance in the form of seed and scaling up funds which are made available to Grameen Bank Replication Partners (GBRPs) as soft loans if they satisfy the selection criteria. The loans are approved case by case on the basis of program design, management capacity and the operational consistency of potential partners with Grameen philosophy and methodology. As of December 2008, GT approved a total of US$ 11,048,191 and disbursed a total of US$ 10,788,884 to partners.

Seed Capital

Many microcredit programs find it difficult to leverage capital at the initial stage of their operation. Most of them face difficulty in not only raising funds for on-lending but also for meeting operational cost. As a wholesale fund, Grameen Trust provides seed capital to microcredit organizations in the start-up stage. The selection of organization for providing seed capital is done primarily on the basis of following criterion:

• The organization should be registered.
• Has permission from government (usually Central Bank) to receive external financial support and carry out credit activities.
• Should have Board's resolution to accept funds as loans from GT.
• Has externally audited financial report (Profit & loss A/C, Balance Sheet, Cash flow Statement) for the previous financial year; if applicable.

Scaling up Funds

For those organizations that have successfully met their targets in the seed capital phase, GT provides scaling up funds for further expansion of their activities. The project must demonstrate potential to grow and expand in order to receive scaling up funds from GT. At this stage, organizations are required to submit detailed financial plans and a projection of when each branch as well as the project will reach break-even point and achieve viability. Eligibility requirements include:

• Successfully meeting their targets for the seed capital phase.
• Each branch must have a minimum of 500 borrowers.
• The repayment rate should be minimum 95%.

In 2008, GT has disbursed a total of US$ 156,277 to MGSCS and SARS in India, Kazama in Philippines and CSC in Pakistan.