Posted by By Nnamdi Duru on
International Finance Corporation (IFC), the private sector arm of the World Bank Group, has become a founding shareholder in Accion Micro-finance Company..
International Finance Corporation (IFC), the private sector arm of the World Bank Group, has become a founding shareholder in Accion Micro-finance Company, investing $1.89 million in the firm. Accion Mico-finance Company is expected to provide credit and other financial services to micro and small enterprises in the country.
Other founding shareholders in the company are a consortium of Nigerian banks and other small and medium enterprises development initiatives. IFC's co-investors include Nigeria International Bank, Ecobank Nigeria, Zenith International Bank, Leadbank, SME Partnership and SME II Partnership and Accion Investments in Microfinance.
Technical assistance for the project would be provided by Accion International, which has received grants from IFC's capacity building facility for this transaction.
The corporation is investing $1.89 million to acquire 12.6 percent shares in Accion Micro-finance Company. The investment is the first IFC project expected to qualify for additional capacity building support from the micro, small, and medium enterprise programme for Nigeria. The program was launched in 2003 by IFC and the World Bank Group's concessionary lending unit, IDA.
This project is a testimony of the corporation's strategic support for sustainable financial institutions serving micro and small enterprises in Africa and having a strong developmental impact on the continent.
Accion's commercial micro-finance techniques would provide better access to finance for Nigerian micro enterprises, accelerate their business growth, boost overall confidence in the financial sector and create new jobs in the country.
Commenting on the project, IFC's Director for Sub-Saharan Africa, Mr. Richard Ranken said, "IFC is committed to strengthening the financial sector in Nigeria and its supportive role for micro-entrepreneurs.
"We are very pleased to become a shareholder in Accion Micro Finance Company and hope that it will soon develop into the leading provider of credit and banking services to micro-enterprises in Nigeria", he added.
IFC's Director for Global Financial Markets, Mr. Jyrki Koskelo also noted, "this is an excellent example of what public-private partnerships can achieve in Nigeria. The government's support for the IFC-IDA initiative and private investments will facilitate access to finance for low-income entrepreneurs in Nigeria. This project marks a significant milestone in the development of commercial microfinance in Africa."
IFC aims among other things to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilises capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses.