The Citi Foundation today announced a three-year US$11.2 million international grant program to advance the integration of microfinance into the mainstream economies of developing as well as transitioning countries. The Citi Network Strengthening Program will increase the ability of 12 major microfinance networks and their members to develop products and services that meet the needs of their clients. In addition, the program aims to enhance the industry's infrastructure, introduce higher standards of management and governance, and promote the vital role of microfinance in providing the poor with access to financial services.

In Central and Eastern Europe and the Newly Independent States the program will be run in partnership with the Poland based Microfinance Centre (MFC) for Central & Eastern Europe & New Independent States and the program's global partner, the US based Small Enterprise Education and Promotion Network (SEEP). It will expand the Citi Foundation's long-standing support of the microfinance industry in the region through grants for capital, training and technical assistance. Over the past ten years, the Citi Foundation has committed more than US$7.6 million in funding for microfinance-related programs in EMEA.

Shirish Apte, CEO for Citi's Central and Eastern Europe Region said, "By strengthening our partnerships with these microfinance organizations, we are helping them play a pivotal role in moving microfinance into mainstream financial services portfolios. Securing a regulatory framework for the microfinance industry will allow it to reach many more people in need."

Grzegorz Galusek, Executive Director, MFC said: "In Eastern Europe and the former Soviet Union countries there are over 150 million low-income people and microentrepreneurs without access to basic financial services. In most cases, financial exclusion results in the social exclusion of these people. Together with our members in 27 countries of the Region, including Slovakia, Hungary, Croatia, Bosnia and Herzegovina, Serbia, Montenegro, Kosovo, Albania, Macedonia, Bulgaria, Romania, Moldova, MFC is very excited to participate in the project that will ultimately make financial services more available to the low-income people and will help them develop their entrepreneurial potential."

Additionally, Bill Tucker, Executive Director, SEEP Network, noted that, "SEEP is privileged to partner with Citi and the Microfinance Centre for Central & Eastern Europe & New Independent States to implement the Citi Network Strengthening Program in Central and Eastern Europe and the Newly Independent States. SEEP supports microfinance networks throughout the world, and this important program will provide the Microfinance Centre for Central & Eastern Europe & New Independent States with opportunities to confirm their current goals, enhance their core capabilities, learn from and orient network peers in other countries who are also participating in this program, and, ultimately, improve services to microentrepreneurs through its member organizations."

The regions and countries participating in the Citi Network Strengthening Program are: China, India, Philippines; Central America, Ecuador, Mexico; Central and Eastern Europe and the Newly Independent States, Russia, Pakistan, and the Middle East.

The Citi Network Strengthening Program will include:

• A comprehensive assessment of the network's capacity to meet the needs of its members;
• An in-depth report on the microfinance industry in the respective country or region;
• Strategic, business and implementation plans which may include embracing new technologies, advocating for interest rate liberalization, establishment of ratings agencies and credit bureaus, creating local debt and equity ratings funds that raise domestic capital, and developing links between the commercial finance and microfinance sectors.

To date, the Citi Foundation has contributed nearly US$60 million in funding to support 250 microfinance institutions, microfinance networks and microenterprise programs in 55 countries.

In addition, Citi Microfinance, a business unit, supports the microfinance sector through commercial activities that build scale, lower costs and introduce new products. Citi Microfinance currently has business relationships with more than 70 MFIs in over 35 countries in Asia, Latin America, Africa, Eastern Europe and the Middle East, as well as global microfinance networks, specialized fund managers, and investors.