FINWIRE®

IFC Helps Expand Access to Finance to Microentrepreneurs in Bosnia and Herzegovina

March 16th, 2009

IFC, a member of the World Bank Group, is providing a loan of up to €7 million to Microcredit Foundation EKI that will enable the company to expand its reach to microentrepreneurs in rural areas.
Microfinance plays a key role in alleviating poverty and creating jobs in Bosnia and Herzegovina. IFC’s subsequent loan is designed to support EKI’s successful microlending program, which targets micro and small enterprises that have little or no access to the formal financial system. The program is expected to disburse more than 4,200 new loans to microentrepreneurs by the end of 2011.

“This investment will enable us to increase financial support to lower-income people, which is particularly important during these times of financial stress,” said Sadina Bina, EKI’s Director. “It will also help strengthen EKI’s developmental role, as microfinance provides means and opportunities for people to generate additional income and improve their living standards.”

IFC’s loan will also be used to finance home-improvement projects, with up to €1 million supporting EKI’s Housing Refurbishment Loan Program that focuses on energy efficiency. Many houses were badly damaged by the war that ended in 1995; the program will provide loans for improvements and installation of energy-saving equipment.

Shahbaz Mavaddat, IFC Director for Southern Europe and Central Asia, said, “We are pleased to cooperate with EKI in addressing the financing needs of Bosnian entrepreneurs. The funding is expected to infuse medium-term liquidity to support EKI’s lending program and have a significant development impact on the country’s microfinance sector.”

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