MFI Report

Oxfam GB’s Armenia Branch credit program has been in operation since end 1995, working in six regions through two local NGO’s. The program was targeting the vulnerable strata of Armenian population, mainly covers refugees, women headed households and local vulnerable people (especially unemployed women, families with more than one child, disabled people, women from the earthquake zone and families with elderly dependants).
In accordance with the three year Strategic Development plan that covers the period from 2000 to 2002 at the end of October 2002 the existing Credit program of Oxfam GB Armenia was registered in the State Register of Armenian Republic as an independent, non-commercial organisation named “Horizon” fund. During the period from November 2002 till December 2006 the fund was acting as an MFI. During that period of time there were disbursed more then 11,500 loans to about 4,500 clients with total amount of 4,639,565,000 AMD (about 12,800,000 USD).
The clients of “Horizon” fund were micro-scale entrepreneurs in urban and rural areas involved in retail trading, small-scale manufacturing, processing, services, land cultivation and animal breading.
In the end of 2005 a law was adopted on “United supervision of financial systems” by National Assembly of Armenia. In according with it all micro-lending funds and programs received official notification from Central Bank of Armenia to bring their activities into compliance with the abovementioned law till March 2006. Otherwise institutions were required to register as for-profit entities and to obtain Credit Organization licenses from the Central Bank. So during the year 2006 in Armenia there were registered “Aregak” Universal Credit Organization (former UMCOR-Aregak program) FINCA, ECLOF (former funds) and Nor Horizon. All these organizations were licensed as Universal Credit Organizations with minimal authorization capital of not less then 150,000,000 AMD (about 350,000 USD).
Taking into account the fact that in accordance with Armenian “Law on Funds” funds cannot transform into for profit entities but can only dissolve in the case of Horizon fund there have been registered “Nor Horizon” Universal Credit Organization LLC under 100% of ownership of Horizon fund. The license from Central Bank of Armenia was received in the end of March 2006 and then, during the year 2006, there were registering 4 branches and 2 representations of the LLC in the regions where formerly Oxfam program and then Horizon fund were working. Horizon fund itself stopped direct lending in the end of 2006. Currently UCO covers a territory with population of over 1.8 million people (1.1 million in capital).
“Nor Horizon” UCO LLC is member of local and international associations, such as MFC and the Association of Mortgage market participants of Armenia. The organization is an active participant in establishment of Association of Credit Organizations.

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