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IFC, Central Banks Promote Credit Reporting, Access to Finance for SMEs in Ethiopia, Mozambique Tanzania


In South Africa:
Sabrina Hadjadj Aoul, IFC
Phone: +27 11 731 3175
Email: Shadjadjaoul@ifc.org

In Washington, D.C.:
Leila F Search
Phone: + 1 202 473 7511
E-mail: LSearch@ifc.org


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 Ulrich Zeisluft, 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.

About IFC
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.