Nairobi, Kenya, July 20, 2009—IFC,
a member of the World Bank Group, announced today it will invest in Faulu
Kenya to help the microfinance institution broaden its products and services
to reach more Kenyans, helping build a more inclusive financial sector
and contributing to the development of a vibrant private sector.
In May 2009, Faulu became the first
microfinance institution in Kenya to receive a license from the Central
Bank of Kenya to accept deposits. IFC will provide a partial credit guarantee
for 80 percent of a 450 million Kenyan shilling loan from Standard Chartered
Bank to Faulu. IFC will also provide advisory support to facilitate Faulu’s
transformation to a deposit taking institution.
“Our partnership with IFC will enable
Faulu to offer a wider range of products and services that better meet
the needs of Kenya’s micro and small entrepreneurs,” said Lydia Koros,
Managing Director of Faulu Kenya “IFC’s global expertise in microfinance
will support Faulu as we apply best practices to offer financial services
to people who need them the most.”
Limited access to finance is a key constraint
to private sector growth in Africa. Only about one in five Kenyans has
a formal relationship with a financial institution, severely hampering
the ability of small businesses to access finance, according to the Finaccess
2009 study by the Financial Sector Deepening Trust, an independent trust
to support the development of financial markets in Kenya.
“Promoting a strong financial system
is essential for sustainable economic development and an important part
of IFC’s effort to reduce poverty and improve people's lives,” said Dorothy
Berry, IFC Vice President for Human Resources, Communications, and Administration.
“Microfinance is a central part of IFC’s strategy to support the development
of a vibrant private sector in 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 $16.2 billion in fiscal 2008, a 34 percent increase over the previous
year. For more information, visit www.ifc.org.