Sarajevo, Bosnia and Herzegovina, March
9, 2009—IFC, a member of the World Bank Group, is providing a loan
of up to €7 million to Microcredit Foundation EKI that will enable the
company to expand its reach to microentrepreneurs in rural areas.
Microfinance plays a key role in alleviating
poverty and creating jobs in Bosnia and Herzegovina. IFC’s subsequent
loan is designed to support EKI’s successful microlending program, which
targets micro and small enterprises that have little or no access to the
formal financial system. The program is expected to disburse more than
4,200 new loans to microentrepreneurs by the end of 2011.
“This investment will enable us to
increase financial support to lower-income people, which is particularly
important during these times of financial stress,” said Sadina Bina, EKI’s
Director. “It will also help strengthen EKI’s developmental role, as
microfinance provides means and opportunities for people to generate additional
income and improve their living standards.”
IFC’s loan will also be used to finance
home-improvement projects, with up to €1 million supporting EKI’s Housing
Refurbishment Loan Program that focuses on energy efficiency. Many houses
were badly damaged by the war that ended in 1995; the program will provide
loans for improvements and installation of energy-saving equipment.
Shahbaz Mavaddat, IFC Director for Southern
Europe and Central Asia, said, “We are pleased to cooperate with EKI in
addressing the financing needs of Bosnian entrepreneurs. The funding is
expected to infuse medium-term liquidity to support EKI’s lending program
and have a significant development impact on the country’s microfinance
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.
EKI began operations in 1996 as a project
of World Vision International, and today it is a leading microfinance institution
in Bosnia and Herzegovina, serving about 53,000 clients. Its mission is
to reduce the economic causes of poverty by providing loans and services
targeted at small businesses, crafts, services and agricultural activities,
mainly in rural areas. As of December 31, 2008, EKI had a net loan portfolio
of $147 million and an equity base of $29 million. The institution has
a network of 70 offices that covers the entire country. For more information,