Kathmandu, Nepal, November 28, 2011 –
IFC, a member of the World Bank Group, will invest $700,000 in equity in the Rural Microfinance Development Centre, a wholesale lending agency for microfinance institutions in Nepal.
The investment from IFC will help increase the agency’s ability to reach more of the poor and improve the country’s microfinance reach, which, at 3 percent, is the lowest in the world. The partnership will also encourage entrepreneurship and self-reliance amongst low income groups.
In addition to the financing, IFC will also provide Rural Microfinance Development Centre with international best practices and assistance in developing a robust business model. The project is expected to have significant development impact on reducing poverty, empowering women, triggering economic development, and improving access to credit in the remote regions of Nepal which currently do not have traditional banking services.
Acknowledging the importance of spreading the reach of microfinance in creating more opportunities for the poor, Shankar Man Shrestha, Chief Executive Officer of the Rural Microfinance Development Centre, said, “While providing a reliable solution out of poverty, this agreement will further enhance participation of the poor, especially women, in economic and social development.”
He added, “IFC support will not only strengthen our company to offer quality finance to MFIs, but also signal a positive message to the financial sector.”
IFC’s microfinance strategy is based on four main pillars: supporting relevant institutions; widening outreach of microfinance; creating platforms for viable funding of Micro Finance Institutions; and inspiring innovations.
“As the first international investor in Rural Microfinance Development Centre against a backdrop of global economic problems, IFC is committed to strengthening the foundations of the financial sector in Nepal,” Said Kyle Kelhofer, IFC Country Manager for Bangladesh, Bhutan and Nepal.
IFC has already partnered with a leading microfinance player in Nepal.
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, providing advisory services to businesses and governments, and mobilizing capital in the international financial markets. In fiscal 2011, amid economic uncertainty across the globe, we helped our clients create jobs, strengthen environmental performance, and contribute to their local communities—all while driving our investments to an all-time high of nearly $19 billion. For more information, visit
www.ifc.org
.
About Rural Microfinance Development Centre
Rural Microfinance Development Centre was established in 1998 by the Nepal Rastra Bank with the shareholding of 13 Commercial banks, five Grameen Bikas Banks, Nirdhan Utthan Bank and Credit Guarantee Corporation. It has been instrumental in promoting and developing microfinance sector in the country. It has been operating in 67 districts of the country through its 100 partner Micro Finance Institutions which provide microfinance services to 1.3 million households. Along with wholesale lending, it also provides capacity building supports and multi-dimensional financial training to Micro Finance Institutions.
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