International Finance Corporation and Ecobank have partnered on a 110 million US dollar risk-sharing facility meant to increase access to finance for small and medium sized enterprises in fragile and conflict-affected states in West and Central Africa.
The financing is also earmarked for countries facing extreme and persistent poverty exceeding 50 per cent of their populations, severe socio-economic challenges such as low employment, lack of infrastructure, and high insecurity.
According to the two partnering organisations, these difficult environments have exacerbated the challenges faced by small and medium-sized enterprises (SMEs), which represent the backbone of the participating countries’ economies and provide the bulk of employment.
“The facility is designed to overcome the challenges of lending to these smaller businesses, which have a higher risk profile, in what are some of the world’s poorest countries,” read the joint statement by IFC and Ecobank.
“With IFC and Ecobank sharing risk equally in the $110 million facility, SMEs in Burundi, Chad, Côte d’Ivoire, Democratic Republic of the Congo, Republic of Congo, Guinea, Mali and Togo will gain increased access to loans through Ecobank affiliates.”
Saran Kebet-Koulibaly, IFC Director for West and Central Africa said her organisation placed much importance in fragile states.
“IFC places a strategic priority on promoting a sustainable architecture to improve access to finance and spur job creation in fragile- and conflict-affected states,” said Kebet-Koulibaly.
“Our partnership will enable Ecobank to better support small and medium enterprises which face difficulty accessing much-needed credit in these economies.”
Ecobank Group CEO Albert Essien said his group was committed to supporting small to medium enterprises.
“Ecobank remains committed to supporting small and medium-sized enterprises, and this facility will go a long way to giving SMEs in fragile states or those emerging from conflict the kind of access to finance that they need,” said Essien.
“We are pleased to be a founding member of the Global SME Finance Forum and to be able to play a part in the launching of SME Club campaigns in many African countries. This includes participating countries for this project.”