Credit Suisse said the business of microfinance for the poor in the developing world will soon attract mainstream investors. The Zurich-...

Credit Suisse said the business of microfinance for the poor in the developing world will soon attract mainstream investors. The Zurich-based bank said in a statement: “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. Worldwide only 10 per cent of the estimated 500 million very small enterprises in developing countries such as India or Ecuador have access to any financial products. Around 5,000 microfinance firms are active worldwide, with an estimated 250 to 500 of those boasting commercial success, said Credit Suisse. The bank added: “The payment behaviour of micro-entrepreneurs is, for example, clearly superior to the one of US credit card holders. 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. Credit Suisse, together with Raiffeisenbanken, Baumann & Cie Banquiers, Alternative Bank, has founded “responsAbility Social Investment Services AG” (www.responsability.ch) and set up the corresponding responsAbility Global Microfinance Fund.