Washington DC, January 3, 2005—The
International Finance Corporation, the private sector arm of the World
Bank Group, will become a founding shareholder in Accion Micro Finance
Company in Nigeria. The new institution will provide credit and other
financial services to micro and small enterprises.
IFC will purchase $1.89 million of common shares for an equity stake of
up to 12.6 percent. The investment marks the first IFC project expected
to qualify for additional capacity building support from the Micro, Small,
and Medium Enterprise Program for Nigeria. The program was launched in
2003 by IFC and the World Bank Group’s concessionary lending unit, IDA.
The project highlights IFC's strategic support for sustainable financial
institutions that serve micro and small enterprises in Africa. These
institutions typically have a strong developmental impact. Accion’s commercial
microfinance techniques will provide better access to finance for Nigerian
micro enterprises, accelerate their business growth, boost overall confidence
in the financial sector, and create new jobs.
IFC’s coinvestors include Nigeria International Bank, Ecobank Nigeria,
Zenith Bank, Leadbank, SME Partnership and SME II Partnership, and Accion
Investments in Microfinance. Technical assistance will be provided
by Accion International, which has received grants from IFC’s Capacity
Building Facility for this transaction.
“IFC is committed to strengthening the financial sector in Nigeria and
its supportive role for microentrepreneurs,” said IFC’s director for
Sub-Saharan Africa, Richard Ranken. He added, “We are very pleased to
become a shareholder in Accion Micro Finance Company and hope that it will
soon develop into the leading provider of credit and banking services to
microenterprises in Nigeria.”
Jyrki Koskelo, IFC’s director for global financial markets, noted, “This
is an excellent example of what public-private partnerships can achieve
in Nigeria. The government’s support for the IFC-IDA initiative and private
investments will facilitate access to finance for low-income entrepreneurs
in Nigeria. This project marks a significant milestone in the development
of commercial microfinance in Africa.”
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.