Gaborone, December 13, 2007—
IFC, a member of the World Bank Group, announced today that it will invest in Micro Provident Botswana, a leading consumer finance company, to help reach previously underserved segments of the market and support sustainable economic development in Botswana, Swaziland, and Zambia. Commonly known as Letshego, the company will use IFC’s $20 million loan to expand the financial products and services it offers through local subsidiaries.
The loan is part of a $50 million debt and equity financing package recently approved by IFC’s Board for Letshego. This will be IFC’s second investment in Letshego following a 7 percent equity stake IFC in 2005 acquired in the company.
“Letshego is pleased to extend our collaboration with IFC,” said Jan A. Claassen, Letshego’s Managing Director. “We are committed to serving the widest possible customer base and providing financial services to more people who have not previously had access, particularly in such countries as Swaziland and Zambia."
IFC will provide the loan in South African rand and Zambian kwacha by using the local currency swap markets. IFC is making its second local currency loan in Zambia to help develop the country’s capital markets and bolster the government’s strategy to develop kwacha financing options.
Access to financial services is costly and limited in much of Sub-Saharan Africa, particularly among lower-income groups who often have access only to deposit services. Much of the population operates on a cash-only basis and outside of the formal banking system. Expanding financial services and enabling more people to participate actively in the economy is thus part of IFC’s strategy in the region’s financial markets.
“Letshego is a good example of a local, independent financial institution that has flourished by expanding regionally,” said Thierry Tanoh, IFC Director for Sub-Saharan Africa. “IFC puts a priority on supporting businesses like Letshego that promote regional development and integration.”
About IFC
IFC, a member of the World Bank Group, fosters sustainable economic growth in developing countries by financing private sector investment, mobilizing private capital in local and international financial markets, and providing advisory and risk mitigation services to businesses and governments. IFC’s vision is that poor people have the opportunity to escape poverty and improve their lives. In FY07, IFC committed $8.2 billion and mobilized an additional $3.9 billion through loan participations and structured finance for 299 investments in 69 developing countries. IFC also provided advisory services in 97 countries. For more information, visit
www.ifc.org
.
About Letshego
Letshego is a pan African consumer finance group that is listed on the Botswana Stock Exchange. Letshego’s trading subsidiaries include:
Name Trading Country Contact Detail
Letshego Financial Services (Pty) Ltd Letshego Botswana
Letshego Guard (Pty) Ltd Legal Guard Botswana
Micro Provident Swaziland (Pty) Ltd MP Swaziland Swaziland
Micro Provident Tanzania Ltd Fadika Tanzania
Micro Provident Uganda Ltd MP Uganda Uganda
Letshego Financial Services Ltd Letshego Zambia
The group’s loan book is in excess of BW Pula 600 million / US Dollars 100 million at its last financial reporting date of 31 July 2007. Letshego’s footprint in Africa is expanding with the most recently established operation being Letshego Financial Services Limited in Zambia. Letshego offers unsecured loans to formally employed individuals and its objective is to provide affordable access to finance.
Letshego’s major shareholders include IFC, Netherlands Development Finance Company (FMO), Sanlam, Investec and Kingdom Zephyr. IFC’s funding relationship expands Letshego’s funding relationships, which include FMO, Standard Chartered Bank, Barclays and First National Bank. For more information visit
www.microprovident.com
