BNP Paribas’ private banking business has signed a partnership agreement with PlaNet Finance, the international organisation that provides s...

BNP Paribas’ private banking business has signed a partnership agreement with PlaNet Finance, the international organisation that provides small loans for the world’s poorest populations. The agreement aims to set up a microfinance investment fund which will be sold to BNP’s private banking clients. PlaNet will provide advice for the fund. The agreement is expected to provide funding for over 30,000 projects, according to reports in the French media. BNP Paribas Banque Privee has invested €3 million ($3.6 million) in the fund directly. The move comes after Credit Suisse released a report saying that the business of microfinance for the poor in the developing world will soon attract mainstream investors. The Zurich-based bank said: “Within socially responsible investment portfolios, microfinance investment products could turn into a standard asset in the future. Large financial players should soon increase the share of commercial investors by providing microfinance investment vehicles and the requisite funding for microcredit respectively.” Credit Suisse, which operates an investment fund that finances micro-credit projects, said the microfinance market was growing 20 to 40 per cent annually. “Microfinance is a high-growth industry, fuelled not only by the size of its target market but also by its sustainable returns,” the bank said. Credit Suisse said its Responsibility Global Microfinance Fund, which provides loans to microfinance institutions, offered investors a reasonable return with the added social benefit of fuelling entrepreneurial growth in developing nations.