Paper
A Quality Label for Microfinance Funds in Luxembourg
Establishing Luxembourg as an attractive platform for funds specializing in financing MFIs
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This paper talks about the creation of a Quality Label with an aim to make Luxembourg an attractive platform for funds specializing in financing MFIs. The quality label for microfinance funds works on certain principles. The fund will:
- Encourage transparency in funds;
- Assure investors that it is invested mainly in microfinance;
- Comply with certain minimum rules of transparency and prudence;
- Detail composition of their portfolio and ratings received by MFIs they have invested in;
- Obtain a current performance rating from a rating agency with microfinance know-how.
The label will be awarded by Ethicalux. It will be valid for a limited time only, and will expire at the end of the period unless renewed. The proposed duration of validity is two years, which could be reduced to one year when Ethicalux has built capacity to handle the additional workload.
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