The loans lent to MFIs by Swiss actors, are often defined according to credit risk and have a term from one to eight years for amounts ranging from US$ 50,000 to US $ 20 million. Currently 74%¹ of microfinance investments are loans of which 70%¹ are in hard currencies and 30% in local currencies¹.

In Switzerland, microfinance actors such as BlueOrchard, ResponsAbility, Symbiotics, Finethic and the Aga Khan Agency for Microfinance etc. extend loans to MFIs. These are generally denominated in Euros or US dollars. However, local currency lendings tend to grow significantly (through CDO issues and funds including loans in local currencies by ResponsAbility: responsAbility Microfinance Leaders Fund). The bullet loans are specially appreciated by MFIs because they give a breather of a few years. Stakes in share capital represent a smaller share of microfinance investments i.e. 25%. In Switzerland, ResponsAbility devotes a smaller share of its funds to share capital investments, the Aga Khan Agency for Microfinance invests 26% of its investments.

Beyond Switzerland, some large NGOs invest in MFI share capital stakes and often have a seat on the Board of Directors to contribute their expertise, advise the MFI in its daily development, growth and institutional strengthening. Guarantees only account for a very small share of microfinance investments, i.e. 1%¹. In Switzerland, the International Guarantee Fund (FIG, a co-operative co-managed by the North and the South) with 73% of its guarantees in Latin America and 27% in West Africa. Guarantees are issued in (USD, EUR, CHF) to local banks in emerging countries, who grant loans in local currencies. The term usually ranges from one to six years.

¹ The Consultative Group to Assist the Poor (CGAP) Building Financial Systems for the Poor / Source: CGAP - Microrate 2005 Survey