Dar es Salaam, June 19, 2013—IFC, a
member of the World Bank Group, today announced a loan of $3 million denominated
in Tanzanian shillings to support the expansion of access to microfinance
in Tanzania. The investment in FINCA Tanzania—a microfinance institution—will
support FINCA as it expands its financial services to women, youth and
rural areas in the country.
IFC estimates that only 12 percent of working
adults in Sub-Saharan Africa have access to banking services, compared
to 22 percent in South Asia and close to 50 percent in Latin America and
Eastern Europe. In Tanzania, 83% of adults do not have access to a formal
IFC provides local currency finance to protect
local businesses from foreign exchange risk. The IFC loan to FINCA Tanzania
is sourced through the shilling/US dollar swap market. The swap was arranged
in partnership with Barclays Bank and NBC Bank, and in collaboration with
the Bank of Tanzania.
With operations in 21 countries and one million
clients globally, FINCA provides financial services to low-income entrepreneurs,
helping them create jobs, build assets and improve their standard of living.
Eighty percent of FINCA’s clients are women. In Tanzania, the company
has over 72,000 borrowers and five hundred employees.
“In 2013 FINCA Tanzania became the first
microfinance institution in the country to transform from a non-regulated
organization to an entity regulated by the Bank of Tanzania,” said Tom
Kocsis, CEO of FINCA Tanzania. “This change in status and the IFC investment
will make it possible for even more Tanzanians living in rural areas to
have access to formalized banking services.”
IFC’s Advisory services team will also work closely with FINCA to help
the company further increase lending to underserved populations.
Oumar Seydi, IFC Director for East and Southern Africa, said, “The impact
of the global financial crisis on East African financial markets
has made it difficult for many financial institutions to raise capital
for their lending operations. This challenge is even greater for micro
and small enterprises. IFC is supporting FINCA to help scale up Tanzania’s
microfinance industry and improve access to finance for businesses, so
that they can create jobs and shared prosperity in Tanzania.”
IFC is a leading investor in microfinance in Sub-Saharan Africa, with a
fast-growing, well-performing portfolio of equity, debt and advisory projects.
IFC’s portfolio includes 24 microfinance clients across 12 countries in
Sub-Saharan Africa, which have reached over 1.5 million microenterprises
and low-income households.
IFC, a member of the World Bank Group, is the largest global development
institution focused exclusively on the private sector. We help developing
countries achieve sustainable growth by financing investment, mobilizing
capital in international financial markets, and providing advisory services
to businesses and governments. In FY12, our investments reached an all-time
high of more than $20 billion, leveraging the power of the private sector
to create jobs, spark innovation, and tackle the world’s most pressing
development challenges. For more information, visit www.ifc.org.