In 2003, the Afghan government called for the establishment of the Microfinance Investment Support Facility for Afghanistan (MISFA), an organization that allows both government agencies and foreign donors to support the nation’s microfinance sector. The organization pooled all funding and created a streamlined process for offering support to various microfinance institutions operating locally according to immediate needs. In addition to financial support, MISFA also monitors performance and provides technical assistance, as necessary. The organization has held nonprofit status since 2006.
Over the years, MISFA has initiated a few flagship projects, one of which is called Access to Finance. This initiative seeks to develop new paths for micro, small, and medium-sized enterprises seeking financial services, especially credit. By providing greater access to financial services, the organization ultimately hopes to increase job creation. Small businesses must invest in themselves in order to grow, and credit provides a reliable means of accessing the capital necessary to hire new staff, purchase equipment and materials, and expand operations.
Another major project is ISAME: Italian Support to Afghan Microfinance and Enterprises. ISAME targets the western provinces of Badghis, Farah, and Herat to spark new development opportunities and drive job creation. Ultimately, the project seeks to improve the basic quality of life for families in these regions by creating new avenues for income generation.
In addition to these projects, MISFA also commissions research on topics related to microfinance and business development in Afghanistan. So far, MISFA has funded studies about the intersection of gender and microfinance, how microfinance can benefit the agricultural sector, and the demand for Sharia-based financial products.
MISFA actively seeks out female borrowers to encourage greater economic independence among Afghan women. Of more than 116,500 active borrowers, more than a third are women. The entire portfolio of investments is valued at $103 million with an average outstanding loan balance of $885 per borrower. Individuals can learn more about MISFA and the specific projects that it supports online at MISFA.org.af.