Myanmar’s MFI sector upended by PGMF exit
The abrupt departure of the US NGO fund from military-run Myanmar leaves a vacuum for microfinanciers.
For more than 25 years, the American non-government organization Pact through its Global Microfinance Fund (PGMF) was a mainstay of village life in Myanmar, a trusted constant in a financially backward nation.
Originally spun out of the United Nations Development Programme’s microfinancing initiative in 1997, PGMF disbursed roughly $4.5 billion in micro loans to millions of people in Myanmar, mostly women. It helped to keep many rural households fed and small businesses afloat, with next to zero defaults.
Indeed, for many in the country, PGMF was their entry point into the world of finance, their first experience of a financial system. With a share of the microfinance sectoras high as 35% by some measures, PGMF was the biggest microfinance operation in a country with a notoriously dysfunctional financial system.
And then, on June 26, 2023, that all ended.
The US-based umbrella fund of impact investors, development aid and philanthropic donors, which had started life in Myanmar while the country was under military rule, has now stopped operations under a military junta of much the same hue.