Washington D.C., June 30, 2004—
The International Finance Corporation, the private sector arm of the World Bank Group, will provide $4 million to Edyficar S.A., a leading microfinance institution in Peru.
Edyficar, which began operations in 1998, is a fast-growing microfinance institution serving 33,600 borrowers with working capital loans, business improvement loans, and, to a lesser extent, housing loans. About half of Edyficar’s clients are women, and 25 percent are estimated to live below the country’s poverty line. Edyficar ranks 20th in size among Peruvian financial institutions, with total assets of $32 million as of December 2003.
IFC’s investment comprises a senior loan of up to $3 million and a subordinated convertible loan of up to $1 million. By supporting a dynamic financial institution that focuses on the highly specialized needs of low-income microentrepreneurs, the funding will help expand sustainable microenterprise finance in Peru.
Jyrki Koskelo, IFC’s director for Global Financial Markets, noted, “IFC is pleased to be partnering with Edyficar in such a high-impact investment. It will help microentrepreneurs further succeed in their projects, and improve the quality of life for their families. IFC is committed to supporting and strengthening Peru’s financial sector, enabling it to provide a full range of services to microenterprise owners.”
Guillermo Fajardo, chairman of Edyficar, added, “It is very gratifying for Edyficar to have IFC’s backing in our efforts to provide financial services to Peru’s low-income entrepreneurs. This support will enable us to expand our portfolio and look to the future with the confidence that comes with the recognition and trust of IFC. The partnership commits us to achieving even greater quality and efficiency in our work.”
Bernard Pasquier, IFC’s director for Latin America, said: “This investment complements IFC's efforts to support microenterprise development in Peru through the Latin American Small Enterprise Facility, a technical assistance facility dedicated to small and microenterprise development in a select number of countries in the region. The facility has begun implementing a comprehensive technical assistance program to support the microfinance sector in Peru.”
IFC's mission (
www.ifc.org
) is 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, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. Since its founding in 1956, IFC has committed more than $37 billion of its own funds and arranged $22 billion in syndications for 2,990 companies in 140 developing countries. IFC's committed portfolio at the end of FY03 was $16.8 billion.
