Alternative Investment Funds, according to the code of law for capital investment, a generic term for all closed-end funds. AIFs also include open-ended investment funds which are regulated by investment law and are not considered to be UCITS (Undertakings for Collective Investment in Transferable Securities), namely open-ended real estate funds, open-ended special funds and, not least, microfinance funds.

AuM (Asset under Management)

The AUM acronym stands for “Assets Under Management.” It refers to the total market value of assets being managed by an investment advisor or financial institution, either from one client or many. 


Bearer Bond

A bearer bond is defined as fixed-income security that is owned by the holder instead of a registered owner. The bondholder has a responsibility of submitting the coupon interest payments, which are physically attached to the bond, to a bank for payment purposes and then redeem the physical certificate when the bond matures. These bonds are negotiable instruments which have a stated maturity date and coupon interest rate.


In the context of microfinance, we speak of the commercialisation of the MFIs when they offer the complete range of banking services to a further target group.

Due diligence

Due diligence, also known as a due diligence check, is a concept that comes from American business law and private law. Buyers go through a due diligence process before the acquisition of real estate or companies, before investing in company shares or before initial public offerings on the stock exchange. This check serves to determine the value of the item to be purchased by weighing up the risks and analysing strengths and weaknesses.

ESG (Environmental, Social, Governance)

ESG stands for Environmental, Social, and Governance, which are three criteria ESG refers to the three central factors in measuring the sustainability and societal impact of an investment in a company or business. ESG investing grew out of investment philosophies such as Socially Responsible Investing (SRI), but there are key differences. Earlier models typically use value judgments and negative screening to decide which companies to invest in. ESG investing and analysis, on the other hand, looks at finding value in companies—not simply at supporting a set of values.

Group Lending

A special way of issuing microcredit loans in the field of microfinancing. Several people come together to form a group and are given a joint loan. The members act as guarantors for one another and support one another in the implementation of their business ideas. The group also makes joint decisions as to who will be accepted as a member. Trust therefore plays an important role with this type of loan. The social pressure that the group exerts on each individual member often makes a key contribution to the high repayment rates.

Impact Investing

Impact investing is an investment strategy which, in addition to achieving financial returns, also aims to achieve specific positive effects in social or environmental terms. Impact investments may take the form of countless different classes of investment and may lead to many different results. With impact investment, the goal is to make use of money and investment capital to achieve positive social results, which means that investors are offered double returns.

Inclusive Growth

Inclusive growth means a type of economic growth that is based on fairness and provides poorer sections of the population with opportunities to improve their situation.

Informal Sector

The informal sector is often the result of the bureaucratisation of emerging and developing countries. Companies in the informal sector are not usually registered and are therefore not liable to pay tax. There are very few barriers to entry and typically the sector involves self-employment, small and yet at the same time labour-intensive production, the use of local resources and a lack of access to organised markets and traditional forms of credit.

Investment Criteria

Features which form the basis for a judgement as to the areas in which a fund is allowed to invest. In the area of sustainability, for example, this would be from an environmental, social or ethical point of view.

Loan Guarantee

The loan guarantee, also known as security, is intended to protect the beneficiary of the guarantee (the lender) from the financial consequences of the risk in the case that a borrower fails to fulfil their obligations in a debtor-creditor relationship or fails to fulfil them within the agreed time. The security offered may take the form of savings or material resources, for example. In most cases, a lack of security prevents microentrepreneurs in emerging and developing countries from obtaining loans from the larger, traditional banks.


Microfinancing is aimed at microentrepreneurs, mostly individual persons who have become self-employed in order to pursue a business idea. Businesses with up to four employees are considered to be micro-businesses. On account of their lack of security, microentrepreneurs are only able to gain very limited access to the traditional financial markets.


Microfinance - also called microcredit - is a way to provide small business owners and entrepreneurs access to capital. Often these small and individual business don’t have access to traditional financial resources from major institutions. This means it is harder to access loans, insurance, and investments that will help grow their business. Essentially, microfinance is providing loans, credit, access to savings accounts - even insurance policies and money transfers - to the small business owner and entrepreneur. There are many such enterprises in the developing world.


The term microenterprise, also known as a microbusiness, refers to a small business that employs a small number of people. A microenterprise usually operates with fewer than 10 people and is started with a small amount of capital advanced from a bank or other organization. Most microenterprises specialize in providing goods or services for their local areas.

Microfinance Institutions (MFIs)

Finance institutions that mainly offer microfinance services. Their goal is to reach low-income households with an increasingly wide spectrum of financial services and to finance small businesses. As well as banks, the term also covers other regulated financial institutions (regulated non-bank financial institutions, or NBFIs), savings and loan cooperatives and non-profit organisations. The overall group of MFIs can be divided up into various levels in terms of entrepreneurial maturity and size.

Missing Middle

In many emerging and developing countries, small and medium-sized enterprises (SMEs) are not able to secure their own financing. It is often the case that the national capital market lacks the financial structure to refinance the necessary investments. There are only very few institutions whose services are tailored to the needs of SMEs. The financial requirements of the SMEs is too great for microfinance institutions (MFIs), yet they are too small for traditional bank loans. And then again, they often lack the potential for growth, returns and resale for them to be of interest to venture capitalists. This results in an enormous gap in terms of financing (the "missing middle") for the segment between the larger medium-sized companies and that of the microentrepreneurs.

Net asset value (NAV)

The NAV refers to the net worth of a firm and is calculated as the difference between the total assets and total liabilities of the firm. NAV is usually referenced in the context of mutual funds and Exchange Traded Funds (ETF) and is expressed on a per-share basis. It is the price at which the units of the fund, registered with the Securities and Exchange Commission (SEC), are traded.

NGO (Non-Governmental Organisation)

A non-governmental organization (NGO) is a non-profit group that functions independently of any government. NGOs, sometimes called civil societies, are organized on community, national and international levels to serve a social or political goal such as humanitarian causes or the environment.



The OECD stands for the Organization for Economic Cooperation and Development. It's an association of 37 nations in Europe, the Americas, and the Pacific. Its members and key partners represent 80% of world trade and investment. The goal of the OECD is to promote the economic welfare of its members. It also coordinates their efforts to aid developing countries outside of its membership. As a result, its programs help reform in more than 100 countries worldwide.

PAR 30 (Portfolio at Risk)

Is the percentage of gross loan portfolio that is at risk. So, PAR 30 is the percentage of the gross loan portfolio for all open loans that is overdue by more than 30 days. It is calculated as follows: Total Principal Balance divided by Total Principal Amount Released of all open loans.

PFIs (Partner Financial Institutions)

Various different financial institutions may become Partner Financial Institutions, for example commercial banks, special banks, such as MFIs, or also investment funds. In each country we invest in, Invest in Visions has countless PFIs which make available funds that can be directly passed on to the SMEs in the respective emerging or developing country.


An action taken within a sustainable investment concept in order to filter out the most suitable investment with the help of certain set exclusion criteria.

SDGs (Sustainable Development Goals)

In its 2030, Agenda, the United Nations specified 17 Sustainable Development Goals (SDGs) for sustainable social, economic and environmental development of all countries of the world. These goals were adopted in 2015 and should be achieved by 2030. Through our investments in microfinance and financial inclusion, we contribute to the achievement of 5 of these 17 Sustainable Development Goals. Learn more about the SDG‘s.

Sustainable Investments

Sustainable investment is interchangeable with social investment. They even share the same acronym (SRI) sustainable/social responsible investing. As such, sustainable investment is when investors consider environmental, social and corporate governance (ESG) criteria when evaluating investment opportunities. Their goal is to invest in companies with the ability to generate long-term financial returns


Small and medium-sized enterprises, although there is no universal definition for this type of company. A commonly used definition states that the company should have at least five employees and at the most 250. Here we are generally referring to the medium-sized sector, in emerging and developing countries too. These companies are the main drivers of economic and social development and are the main employers in these countries. However, they often have insufficient access to finance, see the glossary entry "Missing Middle".

SRI (Socially Responsible Investment)

Socially Responsible Investment (SRI), also known as social investment, refers to investments that are considered to be socially responsible on account of the type of business activity carried out by the company that is being invested in. Socially responsible investments can be made by investing in individual companies that have a positive social value or via socially responsible investment funds. Usually the SRI makes use of fixed exclusion criteria which exclude certain companies or sectors. In accordance with this, the approach does not per se actively seek to achieve a social impact, but rather focuses on ensuring that certain ethical standards are complied with, and is therefore to be distinguished from Impact Investing.

Traditional capital markets

The traditional capital markets or financial markets bring together providers of capital with those needing capital. The economic importance of the financial markets also stems above all from the fact that investors make available long-term finance, both equity capital and loan capital. In return for this, the investors receive a return. The traditional capital markets in emerging and developing countries comprise the sources of funds that were available before the start of microfinancing, for example the large banks. These markets are not available to all market participants, often because there is a lack of incentive for the investors.

Micro-businesses are small companies that have only a small number of employees – normally fewer than 10 persons.


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