Micro Finance


Microfinance is an effective method for promoting financial inclusion and reducing poverty. Investing in Micro Finance Institutions (MFIs) allows investors to achieve financial returns and social impact. 

The Benefits of Investing in Micro Finance

One of the primary benefits of investing in microfinance with Thales Capital is the potential for attractive financial returns. Fixed-income Microfinance Investment Vehicles (MIVs) hedged in dollars have shown a positive performance for the last 10 years, without a negative year or even a negative quarter. 

Furthermore, investing in these Alternative Investment Funds allows investors to support financial inclusion which has a direct impact on various social outcomes, like health, education, and gender equality. By providing access to financial services, MFIs enable low-income families and small businesses to improve their living conditions, create jobs, and stimulate local economies. 

However, such investments also have their risks. Credit risk refers to the potential for borrowers to default on their loans, which can impact the overall performance of the MIV. Currency risk arises from fluctuations in exchange rates, particularly for investments in emerging and frontier markets. 

Micro Finance Investment Strategies and Criteria

Investing in microfinance requires a sound understanding of the sector and the various investment strategies and criteria. Investors must consider target markets, instrument types, and risk profiles when selecting a suitable option.

Target Markets

Investors may focus on particular regions, like Africa, Asia, or Latin America, or opt for a more diversified global approach. Emerging and frontier markets offer higher growth potential, but come with increased risks and volatility. So, investors should carefully evaluate the political and economic stability of target countries beforehand.

Instrument Types

Microfinance investments can be made through debt, equity, or a combination of both. Debt investments typically involve providing small business loans to MFIs, which in turn lend to their customers. Equity investments consist of purchasing shares in MFIs, allowing investors to take part in the growth and profitability of these institutions.

Risk Profiles

Like with a Master Feeder Fund, the risk profile can range from conservative to aggressive. Conservative investments may focus on well-established MFIs with proven track records, while aggressive investments may target early-stage MFIs or those operating in more volatile markets. A balanced approach may involve a mix of both conservative and aggressive investments, offering a diversified risk profile.

Micro Finance Fund Management and Fees

Active asset management is essential in the microfinance sector, given the unique challenges and risks involved. To achieve greater profits, fund managers must have a deep understanding of the local markets, regulatory environment, and specific needs of borrowers to effectively allocate capital and manage investment risk.

Additionally, investors must be aware of the fees associated with microfinance investments, which can include management fees, performance fees, and other expenses. These fees depend on the size of the investment and the complexity of the fund’s strategy. 

In a nutshell, socially responsible investing in microfinance or Green Investment Funds offers a unique opportunity for investors to achieve both financial returns and social impact. By understanding the benefits, investment strategies, fund management, and risks associated with investing in such assets, investors can make informed decisions and contribute to a more inclusive and sustainable global economy.

Why us, could be responded by the What sets us apart, namely:

Profound expertise

We combine technical expertise with a deep understanding of our client’s needs. Headquartered in Luxembourg but with a global reach, we are experts in cross-border solutions. Thales Capital team has an average of 20 years of experience gained at international banks and leading investment firms.


Punctuality and discretion are primordial to long-term financial development and investment performance. Thales Capital delivers well-planned, reliable advice and execution you can rely on. and are committed to being at your disposal.

Loyalty to our customers

To ensure that your interests and goals are always pursued efficiently and effectively, we have a lean and agile structure.

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Ivaylo Markov
Managing Partner

2 Place de Strasbourg
L-2562 Luxembourg

Temo Tcheishvili

Startbaan 6, 1185 XR Amstelveen
Greater Amsterdam, The Netherlands

Filippo Mecacci

2 Place de Strasbourg
L-2562 Luxembourg

Roger Berk
Senior Advisor

Startbaan 6, 1185 XR Amstelveen
Greater Amsterdam, The Netherlands


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  • What is microfinance, and how does it work?
  • What are the benefits of investing in microfinance?
  • What are the risks associated with investing in microfinance?
  • How do microfinance institutions generate income for their investors?
    • Thales Capital Luxembourg is a licensed, independent advisor specialized in private capital management, fund structuring, governance, investments and capital raising.


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