Johannesburg, South Africa, March 5,
2010‒IFC, a member of the World Bank Group, this week launched a
series of programs in cooperation with the central banks of Ethiopia, Mozambique,
and Tanzania aimed at increasing the quality of credit reporting in Africa.
The lack of credit information hinders banks from widely offering financial
services. New and smaller businesses—engines of job creation and economic
growth stand to gain the most from improved reporting as better public
information helps them establish creditworthiness.
IFC has co-hosted a series of regional workshops
that brought together central banks, financial institutions, national bankers’
associations, and commercial banks. Workshops began on March 1 in Addis
Ababa, Ethiopia and conclude on 5 March in Maputo, Mozambique. Sessions
included best practices in credit reporting and how credit reporting can
increase financial services for small and medium businesses in Africa.
African economies are comparatively difficult
markets for individuals and businesses to get credit. The IFC-World Bank
Doing Business in 2010 report ranked Tanzania 87 out of 183 countries
surveyed for ease of getting credit. Ethiopia and Mozambique were equally
ranked at 127, Ethiopia and Tanzania have virtually no public or private
credit registry coverage, while Mozambique’s has only 2.3% coverage of
adults through a public registry.
IFC works with banks to promote greater access
to financial and banking services for small and medium enterprises, as
these businesses make significant contributions to employment, economic
activity and poverty reduction. However, they are often without access
to financial services, making it difficult to grow and improve their services.
Promoting greater access to finance and banking services for SMEs has become
a key economic objective for governments and central banks in these countries.
The IFC Africa Credit Bureau Program expects to increase lending to SMEs
by US$ 20,000,000 reaching 5000 SMEs in Tanzania and by US$ 15,000,000
reaching 3750 SMEs in Mozambique.
“These workshops are timed to coincide with
efforts by the central banks of Ethiopia, Mozambique, and Tanzania to design
or implement credit information sharing systems in their countries,” said
IFC Principal Financial Specialist. “IFC’s global experiences will
help them define perceptions and strategy.”
Each workshop was co-hosted with the Central
Bank-National Bank of Ethiopia, Banco de Moçambique, and Bank of Tanzania.
Speakers included IFC and World Bank experts, executives from global
and African banks, credit bureaus, and international risk management specialists.
IFC is the only international financial institution
focused exclusively on the private sector, the engine of sustainable development
in emerging markets. Along with IBRD, it is currently seeking a capital
increase to strengthen its ability to create opportunity for the poor in
developing countries—including by supporting credit bureau development
and financial services for small and medium business in Sub Saharan Africa.
IFC, a member of the World Bank Group, creates
opportunity for people to escape poverty and improve their lives. We foster
sustainable economic growth in developing countries by supporting private
sector development, mobilizing private capital, and providing advisory
and risk mitigation services to businesses and governments. Our new investments
totaled $14.5 billion in fiscal 2009, helping channel capital into developing
countries during the financial crisis. For more information, visit www.ifc.org.