Kinshasa, Democratic Republic of the Congo, February 6, 2023 – IFC and Equity Banque Commerciale du Congo (EquityBCDC), a subsidiary of Equity Group, announced today a partnership to increase access to finance for small and medium-sized enterprises (SMEs) in the DRC and to promote economic diversification in the country.
Under the partnership, IFC will support the expansion of EquityBCDC's SME-lending operations through a $12.5 million risk sharing facility (RSF).
IFC is also providing advisory services to strengthen EquityBCDC's SME banking solutions and enhance its risk management approach, supporting the bank's growth strategy.
Through the partnership, EquityBCDC aims to provide an additional 1,700 SME loans within the DRC and expand its SME portfolio from $250 million in 2021 to $631 million by 2026.
Speaking during the partnership agreement signing ceremony in Kinshasa, Celestin Mukeba, EquityBCDC Managing Director said, "Small and medium-sized enterprises remain a focal point for EquityBCDC's business and our partnership with IFC will allow us to extend our loan guarantee program which will enhance our product offering to this particular market segment."
Also speaking at the event, Jumoke Jagun-Dokunmu, IFC Regional Director for Eastern Africa said, "Increasing access to finance for smaller businesses is a priority for IFC in the DRC, where many businesses struggle to access funding in order to grow. IFC's support will allow EquityBCDC to boost its support for smaller businesses in the country, contributing to economic growth and job creation."
SMEs in the DRC identify financing as a major obstacle to growth. According to the World Bank Group's MSME finance gap report, 53 percent of MSMEs experience constraints when accessing a loan or line of credit, and the unmet finance gap is estimated to be equivalent to 26 percent of GDP.
The partnership with EquityBCDC deepens IFC's longstanding relationship with Equity Group to support SME development. In November 2021, IFC loaned the equivalent of $50 million in Congolese francs to EquityBCDC to help underserved SMEs in the DRC access local currency financing and avoid the risk of currency fluctuations.
The partnership is also part of IFC's Small Loan Guarantee Program (SLGP), which strengthens the capacity of financial institutions for risk taking and financing SMEs in IDA PSW-eligible countries. The SLGP is supported by the IDA18 Private Sector Window (IDA-PSW)'s Blended Finance Facility.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2022, IFC committed a record $32.8 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visit www.ifc.org.
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About the IDA Private Sector Window
As part of the 19th replenishment of the International Development Association (IDA), the World Bank Group is continuing the IDA Private Sector Window (PSW) created under IDA18 to catalyze private sector investment in the poorest and most fragile countries. Recognizing the key role of the private sector in achieving IDA's objectives and the World Bank Group's twin goals, the window provides a source of co-investment funding and guarantees to de-risk private investments supported by IFC and the Multilateral Investment Guarantee Agency (MIGA). The IDA PSW is an option when there is no commercial solution, and the World Bank Group's other tools and approaches are insufficient. For more information, visit: http://ida.worldbank.org/psw
About EquityBCDC
EquityBCDC is a subsidiary of Equity Group (EGH) Holdings Plc, following the acquisition of the majority of BCDC shares by EGH in July 2020. The Bank has been operating in the DRC since 1909. EquityBCDC facilitates access to banking services for all and finance Micro, Small, Medium and Large Enterprises, in particular through inclusive financial products and services that socially and economically flourish consumers, businesses and communities. EquityBCDC's vision is to be the champion prosperity for the people of Africa by transforming lives, bringing dignity and providing opportunities for wealth creation.
EquityBCDC Website: https://equitygroupholdings.com/cd/
