WASHINGTON, D.C., March 2, 1999 --- The
International Finance Corporation will provide a local currency guarantee
of up to CFAF 160 million (about US$290,000) to Kafo Jiginew, the largest
microfinance institution in Mali.
The guarantee will allow Kafo Jiginew to obtain medium-term local currency
loans from a local bank for about twice the guaranteed amount. Kafo Jiginew
will be able to mobilize funding to meet the growing credit demand from
people who have no access to the formal banking system. The guarantee
will help to develop long-term lending operations for which there is increasing
demand. This operation is designed to encourage commercial banks
to lend to microfinance institutions.
The project will promote outreach to the most economically disadvantaged
groups and IFC is considering the same kind of operation with two other
microfinance institutions in Mali. After his recent trip to Africa,
Executive Vice President Peter Woicke said IFC would focus on helping small
business get financing as building blocks for a thriving private sector
that will reduce poverty.
Kafo Jiginew is a federation of 81 local credit unions owned by about 58,000
individual members. It operates in the cotton-growing regions of
Mali, is well-managed and recognized as one of the country's leading microfinance
IFC, part of the World Bank Group, fosters economic growth in the developing
world by financing private sector investments, mobilizing capital in the
international financial markets, and providing technical assistance and
advice to governments and businesses.