A new investment between IFC and CRDB PLC announced today will increase access to finance for micro, small and medium enterprises Tanzania and Burundihelping to strengthen both countries’ recovery from the economic effects of the COVID-19 pandemic.
As part of this partnership, IFC provides a $100 million loan to CRDB Bank Tanzania, half of which will be in local currency, and a $5 million loan to CRDB Bank Burundi to support lending to small businesses in both countries, especially women-owned businesses. Up to 25% of the loan in Tanzania will be dedicated to women-owned businesses. The partnership will increase the availability of longer-term financing, which is not readily available in the market and has been in short supply since the outbreak of the COVID-19 pandemic.
The loans are part of IFC’s Base of the Pyramid program, which helps financial service providers provide financing to small businesses that have been hardest hit by the COVID-19-induced downturn. IFC’s financing is also supported by the International Development Association Private sector window.
Small businesses are essential to the economy of Tanzania and Burundi. In Tanzania, around 3.2 million micro, small and medium enterprises contribute 27% of the country’s GDP and employ more than 5 million people. However, about 81% of these businesses do not have access to financing. Companies in Burundi also struggle to access funding.
“This line of credit is timely and will strengthen our support for SMEs while promoting gender diversification throughout the value chain. To CRDB Bank, we believe that gender equality and the empowerment of women are at the heart of development. Women have been disproportionately affected by the COVID-19 pandemic, facing economic hardship that directly affects the livelihoods of their families and communities. Through this partnership, we will help women-owned small businesses and entrepreneurs recover from the pandemic,” said Abdulmajid Nsekela, CRDB Bank Group CEO and Managing Director, adding that IFC financing would support the development of productive sectors of the economy, including agribusiness, health, education, affordable housing and infrastructure. Other sectors include climate change mitigation and adaptation, SMEs, as well as women-owned small businesses.
“The partnership between IFC and CRDB will support the growth of small businesses in countries where their contribution to employment and economic activity is immense. The financing will also focus on supporting women-owned businesses and promoting women’s inclusion, a key part of IFC’s strategy for Tanzania and Africa more broadly,” said Sergio PimentaIFC Vice President for Africa.
IFC has a long-standing relationship with CRDB Bank. The financing announced today is IFC’s fifth facility with CRDB and is part of IFC’s growing work in Tanzania to support small business growth and boost inclusive finance for women-owned businesses.
IFC-a member of the World Bank Group-is the world’s largest 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 2021, IFC committed a record $31.5 billion to private businesses 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 effects of the COVID-19 pandemic . For more information, visit www.ifc.org.
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About CRDB Bank Plc
CRDB Bank Plc is part of East Africa leading banks, serving individuals, VSEs, SMEs and large companies with a full range of Retail, Treasuryinsurance, trade finance, syndications, prime banking, agriculture and microfinance. CRDB Bank is the first bank of Tanzania be ranked among the top ten stable and safest African banks to invest in by the world’s most respected rating agency, Moody’s Investor services. Moody’s note CRDB Bank with a “B1 stable outlook” which is the highest rating to have been acquired by banks or financial institutions in sub-Saharan Africa. CRDB Bank offers unparalleled comfort in Tanzania and Burundi serving over 3 million customers with a large footprint of 268 branches, over 20,000 Wakala CRDBs, 550 ATMs, over 1,800 merchants and a 24/7 call center. For more information: www.crdbbank.co.tzwww.instagram.comifc_org
About the IDA Private Sector Window
As part of the 19th replenishment of International Development Association (IDA), the World Bank Group continues 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 objectives and World Bank Group Dual purpose, the window provides a source of co-investment finance and guarantees to de-risk private investments supported by the IFC and the Multilateral Investment Guarantee Agency (MIGA). IDA PSW is an option when there is no commercial solution and World Bank Group other tools and approaches are insufficient. For more information visit: http://ida.worldbank.org/psw
Telephone: +254 11 282 5197
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Tully Esther Mwambapa
Telephone: +255 769 200 600
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