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IFC and CRDB Bank commit to support SME and agribusiness sectors in Tanzania


In Nairobi:
Neha Sud

Phone: +254 720 348 499

Email:nsud@ifc.org


In Washington, D.C.:
John McNally

Phone: +1 202 458 0723

E-Mail:
JMcnally@ifc.org


Washington, DC, April 11, 2014—IFC, a member of the World Bank Group, today signed a landmark $75 million agreement with CRDB Bank that will help provide much needed support to small businesses, particularly those owned by women, as well as to farmers and agribusiness in Tanzania.

In Tanzania, there is a significant financing gap for SMEs, and women-owned businesses are particularly disadvantaged with only 15% reporting having access to a bank loan.  Access to finance is critical to helping them to grow their businesses and contribute to economic development. IFC and CRDB Bank will partner to focus on underserved SME and retail market segments as well as agribusiness producers and exporters.

Jean Philippe Prosper, IFC Vice President for Sub-Saharan Africa, said: “IFC is committed to partner with CRDB Bank to reach out to underserved communities in Tanzania. This is the beginning of IFC’s collaboration with CRDB Bank and we hope to work more closely to support economic development and promote job creation in the country.”

“Working with IFC, we intend to strengthen our reach to SMEs and further promote agri commodity export. As a market leader in Tanzania, we have a mandate to support these market segments and are grateful to launch the collaboration with IFC,” said Dr. Charles Stephen Kimei, Managing Director of CRDB Bank Group.

The investment will promote financing for women-owned businesses, as well for farmers, capitalizing on CRDB Bank’s position as a leader in financial inclusion in Tanzania. IFC also plans to provide advisory services in the field of trade and warehouse financing to strengthen CRDB’s operations.

The signing ceremony took place in Washington DC during the World Bank-IMF Spring Meeting and was observed by the Finance Minister Hon. Saada Mkuya Salum, Tanzanian Ambassador to the USA Liberata Mulamula, and the Bank of Tanzania Governor Prof. Benno Ndulu.

The comprehensive investment package consists of a $40 million loan targeting SMEs, particularly those owned by women, including $6 million through IFC’s Global SME Finance Facility; a $10 million trade line through IFC’s Global Trade Finance Program and $25 million through IFC’s Global Warehouse Finance Program to support the agricultural commodity business, including $10 million from the Global Agriculture and Food Security Program’s (GAFSP) private sector window.

About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in more than 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and promote shared prosperity. In FY13, our investments climbed to an all-time high of nearly $25 billion, leveraging the power of the private sector to create jobs and tackle the world’s most pressing development challenges. For more information, visit www.ifc.org

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About CRDB Bank

CRDB Bank is the largest commercial bank in Tanzania (market share: 18% by asset size, 20% by deposits). It is listed on the Dar es Salaam Stock Exchange. It has regional ambitions, having recently opened a subsidiary in Burundi which will focus on bottom of pyramid, microfinance segment. CRDB Bank is currently owned by over 35,000 shareholders, one of the fastest growing banks in the country, with a 20% share in the market for deposits, it operates in every region in the country with a network of 103 branches, 311 ATMs, 15 Mobile branches, 1,162 Point of Sales (POS) terminals, 491 agents, and 441 microfinance partners, including a focus on microfinance and helping Tanzanian SMEs.

For more information, visit http://www.crdbbank.com

IFC Global Warehouse Finance Program

IFC’s Global Warehouse Finance Program (“GWFP”), created in 2010, aims to increase working capital financing to farmers and agricultural players by leveraging their production. The program supports the agriculture sector by providing banks with liquidity or risk coverage backed by warehouse receipts or other inventory financing schemes, which are used to provide financing in the form of short term loans to producers and traders ahead of export. To date, IFC has financed US$4.6 billion commodity finance transactions in more than 20 countries. The program is expected to reach up to 241,000 farmers across emerging markets in all regions and contribute to food availability for 15 million people by 2016.

Global Agriculture and Food Security Program  (GAFSP)

The (GAFSP) is a multilateral mechanism to assist in the implementation of pledges made by the global community to support country-led investment plans.  GAFSP Private Sector Window (PSW) plays a catalytic role by supporting private sector investment projects and promoting sustainable agriculture in developing countries. GAFSP aims to improve the livelihoods of SMEs and small hold farmers through sustainable solutions to improve access to finance and reduce risks in agriculture. GAFSP is funded by five donors including the Netherlands, Canada, Japan, United Kingdom through DFID, and the United States.
   
Global SME Finance Facility

Responding to a call from the G-20 to bridge the trillion dollar financing gap faced by SMEs, IFC developed the Global SME Finance Facility in partnership with international financial institutions, commercial banks and donors, with the United Kingdom’s Department for International Development.  The purpose of the Facility is to help banks and non-bank FIs in developing countries expand their services to underserved SME segments. Through a combination of investment and advisory services, the Facility aims to support and accelerate the trends that are driving growth in the SME markets, with a particular focus on SMEs in fragile and conflict-affected situations and on women-owned SMEs.