Washington D.C., December 21, 2004—The
International Finance Corporation, the private sector arm of the World
Bank Group, and K-Rep Development Agency (“KDA”) signed today an agreement
worth a grant worth $25,000 and a loan for $100,000. The funds will support
the expansion and development of a microleasing and small loan facility
and the upgrading of KDA’s management information system and monitoring
and evaluation system.
KDA is a microfinance research and development arm of the K-Rep group in
Kenya. Its focus is on expanding access to financial services for
low-income Kenyans who traditionally have not been fully reached by formal
financial institutions. KDA has tested and developed innovative financial
products and mechanisms for improving the accessibility of financial services.
Since 2003, kt has piloted a microleasing scheme for beehives, which
enables low-income people to acquire productive assets and engage in income-generating
The project is expected to yield considerable financial, social, and economic
benefits as it strengthens KDA’s management capabilities in microleasing
through technical assistance in credit evaluation, portfolio risk management,
and monitoring capabilities. The project will enable KDA to broaden outreach
to the rural poor in Kenya, thus helping alleviate poverty. The loan
facility will be expected to reach, among others, beneficiaries of organizations
supported by the IFC’s Strengthening Grassroots Business Organizations
KDA intends to support leases for beehives
and foot pedal water pumps, as well as small working capital loans for
medicines at innovative medical franchise operations in Kenya. Local
communities will benefit from increased income and improved livelihoods.
The microleasing project with KDA is part of IFC’s strategy to promote
leasing a new financial product in Sub-Saharan Africa.
Strengthening Grassroots Business
Jointly with the World Bank, IFC has launched a new initiative to support
efforts by poor, marginalized people to expand revenue-generating activities
that bring them into the market economy. This initiative can provide
technical assistance or patient capital investments to strengthen organizations'
access to markets, management capacity, and capital structure. Recipients
can be not-for-profit or for-profit. The initial focus is to provide
direct support to pilot projects in Africa, Asia, and Latin America. The
initiative will also seek effective ways to reach a wide range of grassroots
businesses and promote a wholesale approach to supporting this sector.
For more information, please visit www.ifc.org/gbo
The mission of IFC (www.ifc.org)
is to promote sustainable private sector investment in developing countries,
helping to reduce poverty and improve people’s lives. IFC finances private
sector investments in the developing world, mobilizes capital in the international
financial markets, helps clients improve social and environmental sustainability,
and provides technical assistance and advice to governments and businesses.
From its founding in 1956 through FY04, IFC has committed more than $44
billion of its own funds and arranged $23 billion in syndications for 3,143
companies in 140 developing countries. IFC’s worldwide committed portfolio
as of FY04 was $17.9 billion for its own account and $5.5 billion held
for participants in loan syndications.