Dar Es Salaam, February 26, 2007
– IFC, the private sector arm of the World Bank Group, has provided a
loan to Exim Bank, Tanzania, to finance women-owned businesses. IFC’s
$5 million financing makes Exim Bank the first financial institution in
Tanzania to dedicate lines of credit to women entrepreneurs.
IFC’s funding will allow Exim Bank
to meet the financing needs of its female clients, particularly those running
small and medium enterprises. IFC’s Gender Entrepreneurship Markets program
will provide comprehensive assistance and training to help the bank reach
out to the women’s market as well as make business and management training
available for women entrepreneurs.
Speaking at the signing, Rachel Kyte,
IFC’s Director for Environment and Social Development, said, “We aim,
with this investment and our advisory services, to bridge the gap between
women entrepreneurs who need financing and banks that are looking for new
customers. Our experience is that businesswomen have a better repayment
rate than their male counterparts and that they contribute more to household
income and to schooling for their children. We hope our investment will
translate into improved livelihoods for a wide cross-section of society
and will show the financial sector more broadly that lending to women owned
business makes good banking sense.”
S. M. J. Mwambenja, Managing Director
of Exim Bank, said, “Lending to women entrepreneurs is part of Exim Bank’s
five-year strategic plan to explore new areas of growth. Being the first
bank in Tanzania to target the women’s market will give us the competitive
edge we are looking for.”
The financial services sector in Tanzania,
as elsewhere in the region, is becoming more competitive, with banks seeking
opportunities to differentiate themselves. At the same time, women entrepreneurs
who seek financing to develop their businesses face a number of obstacles.
Few women possess land titles, which are often required as collateral
for loans; and women’s applications are often not taken seriously by bank
officers. While women’s access to microfinance is easier, the maximum
loan size and tenor from microfinance is often too low. Meanwhile,
woman entrepreneurs running midsize enterprises frequently lack the training
and financial resources they need to gear up their businesses for growth.
Jyrki Koskelo, Director of IFC’s Financial
Markets Department, said, “Focusing on women-owned businesses, currently
a vastly underserved sector in the country, will allow Exim Bank to expand
considerably its lending to SMEs. By partnering with Exim Bank, IFC will
support women entrepreneurs’ increased participation in Tanzania’s economy
and thus hopes to contribute to the country’s development.”
IFC’s lending to Exim Bank is part
of a wider program to increase access to finance for women entrepreneurs
in Africa. IFC provided Access Bank in Nigeria with a $15 million loan
in June 2006 to extend lines of credit to women entrepreneurs. Similarly,
in October 2006, IFC provided DFCU in Uganda with a $6 million loan.
Yogesh Manek, Chairman of Exim Bank,
registered his bank’s appreciation for the support that IFC has been extending
since 2003. He reiterated that with the line of credit the bank will
be able to finance more women-owned small and medium enterprises.
About Exim Bank
Exim Bank is a member of the Global
Banking Alliance for Women, a worldwide group of banks that are sharing
best practices to accelerate the global growth and development of women's
businesses and women's wealth creation. It is the first member bank
Exim Bank started operations in Tanzania
in 1997 and has recorded remarkable growth during its nine years of operations,
as well as improvements in all key financial performance indicators. As
of December 2006, the bank recorded a profit of 8.2 billion Tanzanian shillings
(net after provisions). The deposit base increased to 226.4 billion
shillings, with a loan portfolio of 120.8 billion. The bank’s asset
base grew to 268.0 billion shillings.
Exim Bank has expanded its network across
Tanzania to 10 branches, with locations in Dar es Salaam main, Clock Tower,
Hill Park, Temeke, Mtwara, Arusha, Tanga, Morogoro, Mwanza and Moshi. Exim
plans to open three more branches during 2007 to reach more and more customers.
In July 2006, Exim Bank became the first
and only bank to introduce international credit cards issued in Tanzania.
Now Tanzanians can shop online, purchase goods at over 24 million
merchant outlets, and access cash at over 1 million ATMs worldwide. Exim
Bank has already installed 22 ATMs in Tanzania to facilitate delivery of
this service. For more information, please visit www.eximbank-tz.com.
IFC, the private sector arm of the World
Bank Group, promotes open and competitive markets in developing countries.
IFC supports sustainable private sector companies and other partners
in generating productive jobs and delivering basic services, so that people
have opportunities to escape poverty and improve their lives. Through FY06,
IFC Financial Products has committed more than $56 billion in funding for
private sector investments and mobilized an additional $25 billion in syndications
for 3,531 companies in 140 developing countries. IFC Advisory Services
and donor partners have provided more than $1 billion in program support
to build small enterprises, to accelerate private participation in infrastructure,
to improve the business enabling environment, to increase access to finance,
and to strengthen environmental and social sustainability. For more information,
please visit www.ifc.org.