LOLC ventures into microfinance
Lanka ORIX Leasing Company PLC (LOLC), signed an agreement with the
Dutch Development Bank FMO in Netherlands to launch LOLC Micro Finance
Chairperson LOLC Rohini Nanayakkara
Senior Investment Officer FMO Arno de Vette and Deputy
Chairman Ishara Nannayakkara. Picture by Saliya Rupasinghe
They hope to provide a package of equity convertible loans and senior
loans of in total US$ 10 million, Chairperson LOLC Rohini Nanayakkara
told a press conference held at the Trans Asia Hotel, Colombo yesterday.
This is a landmark event in the history of the Sri Lankan finance
industry as it is the first time that a private sector local micro
finance entity is set up with foreign equity,” she said.
Senior Investment Officer of FMO Arno de Vette said the FMO will be
20 per cent shareholder and Lanka Orix will have 80 per cent of the
shares and it will provide capacity development to upgrade staff
products and systems. He said under the new micro finance company
clients will specially be active in the rural sector, small loans to
finance agricultural equipment, renewable energy products like solar
panels and bio gas installations in the future.
“We are delighted to team up with Lanka Orix and we are convinced
that the number of clients will grow fast” he said. Micro Finance is
access to finance for people who have no access to finance right now and
this business is very potential according to Vette.
Chief Executive Officer LOLC, Ravi Tissera said the poor people in
conflict areas such as Batticaloa, Kalmunai and Trincomalee also will
benefit by this new venture.
He said LOLC firmly believes that the launch of this entity will mark
the dawn of a new era for the microfinance industry of Sri Lanka and
hoped that this partnership will greatly benefit the rural community.”
The Netherlands Development Finance Company (FMO) is the
international development bank of the Netherlands and they invest risk
capital in companies and financial institutions in developing countries.
FMO’s investment portfolio is about EURO 3.4 billion and it is one of
the largest bilateral development banks worldwide.
FMO is able to take risks which commercial financiers not yet
prepared to take risks due to their strong relationship with the Dutch