Linkedin-in

MSME Finance Program

International Finance Corporation

MSME Finance Program

International Finance Corporation

MSME Finance Program seeks to increase lending to priority sectors such as women entrepreneurs, MSMEs contributing to food security, first-time MSME borrowers, and MSMEs in vulnerable regions affected by climate change. We expect Fragile, Conflict-affected Situation Countries as well as Middle-Income Countries to benefit from this facility.

The Program’s clients will include traditional financial services providers such as SME-focused banks, microfinance institutions, non-bank financial institutions, and the new generation of IFC’s partners – digital finance and embedded finance players.

Project Details

Micro, Small, and Medium Enterprises (MSME) are considered the backbone of the economy in most emerging markets and developing economies (EMDEs). MSMEs typically represent a large fraction of the private sector activity and account for a sizeable share of employment in EMDEs.

Over the last two years, IFC improved its originating capacity for new clients, by offering working capital solutions, base of the pyramid lending and risk sharing facilities on MSME portfolios.

  • IFC is developing a comprehensive multi-year MSME finance Program of up to 5 billion dollars, under which IFC’s Own Account funding will be supplemented by innovative credit-enhanced mobilization instruments. This MSME Finance Program aims to create more usable capital, mobilizing financial markets as sources of development finance and potentially freeing billions of dollars in additional financing.
  • IFC, with IDA-PSW and EC funded EFSD+ program support, expects to address the financing needs of MSMEs, informal entrepreneurs, and low-income households whose income streams continue to be affected by persisting uncertainty and challenging economic prospects.
Anticipated Impact
  • The MSME Finance Program will boost new job creation and sustain existing jobs in emerging markets – but on a much greater scale. As one of the elements of this program, we are also earmarking up to 250 million dollars of the funds for funding resilience and protection for MSMEs and other vulnerable communities located in small island nations that are most at risk of the effects of climate change and resulting natural disasters.
  • Through this partnership with private sector investors, IFC seeks mobilization support from partners, expects to increase outreach, lower transactional costs and expand the range of financial services being offered to MSMEs
Support/Partnership Required
  • IFC seeks mobilization support both on blended finance and participation from international banks and private sector investors to join us in increasing lending to MSMEs in in emerging markets and developing economies.
  • Through this partnership with private sector investors IFC expects to increase outreach, lower transactional costs and expand the range of financial services being offered to MSMEs.