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Kathmandu, Nepal, June 14, 2010
—IFC, a member of the Word Bank Group, will make an equity investment of up to10 percent in Nirdhan Utthan Bank Ltd, a microfinance development bank in Nepal that expects to reach more than 150,000 borrowers in the next five years.
IFC will play an important institution-building role to enable Nirdhan to expand its outreach in microfinance. In addition to financial support, IFC will work with Nirdhan Bank to adopt industry best practices and help strengthen the bank’s business model.
“With IFC’s support, we expect to build confidence among the investor community. And as a result, we feel more investors and stakeholders will come forward to support our expansion in the microfinance sector,” said Harihar Dev Pant, Chief Executive Officer, Nirdhan Bank.
Access to microfinance in Nepal is limited. Existing microfinance institutions have limited institutional capacity and ability to access adequate capital to meet the large gap in credit supply to the poor.
“IFC’s work with Nirdhan Bank aligns with our strategic focus of making microcredit available to individual borrowers, who have unmet needs, especially in areas where the need for microcredit is highest,” said Paolo Martelli, IFC Director for South Asia.
The project will also help improve access to credit in underserved hilly areas, which are more difficult to reach by the formal banking sector.
About IFC
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing capital for private enterprise, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $14.5 billion in fiscal 2009, helping channel capital into developing countries during the financial crisis. For more information, visit
www.ifc.org
.
About Nirdhan Utthan Bank
Nirdhan Utthan Bank, a microfinance bank, commenced operations in 1999 by taking over the microfinance activities of Nirdhan NGO, which was engaged in offering microfinance services since 1993. Nirdhan Utthan Bank, Nepal’s largest microfinance development bank, has an outreach of more than 126,000 clients and outstanding loans of approximately $19 million. It offers a wide range of loan products, deposit products, micro insurance, and remittance services. For more information, visit
www.nirdhan.com
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