IFC Helps Increase Microfinance Access for Small Businesses in Armenia’s Rural Areas, January 2010IFC Helps Increase Microfinance Access for Small Businesses in Armenia’s Rural Areas, January 2010
27 January, 2010
Yerevan, Armenia, January 25, 2010
, a member of the World Bank Group, is helping INECOBANK
expand its microfinance capacity to increase access to microfinance for small entrepreneurs and low-income individuals, mostly in Armenia’s rural areas, promoting growth and sustainable development.
In cooperation with IFC, Inecobank is expected to strengthen its capacity to reach Armenia’s people, most of whom have limited access to microfinance. IFC has introduced an innovative form of support, performance-based grants structured in tranches, whereby clients are rewarded for achieving development targets. Through a gradual, step-by-step process, IFC will release up to USD 700,000 of performance-based grants for the bank, making more than 71,000 new micro loans to individuals and small entrepreneurs, mostly in rural areas of Armenia. “With the onset of the financial crisis, microfinance proved to be one of the most sustainable products for the bank and one of its strategic sector priorities,” said Avetis Baloyan, INECOBANK’s CEO.
“Through participation in the IFC’s Microfinance Initiative, we are planning to significantly increase our microfinance sector penetration and reach out to the underserved markets.” Georgina Baker, IFC Director for Global Financial Markets,
said, “Microfinance has proven to be a critical tool in the fight against poverty. Our support to INECOBANK will enable the bank to offer a variety of microfinance products to the businesses and individuals that have not had access to these services before, thus promoting growth and sustainable development in the country.”
IFC’s expanded cooperation with INECOBANK is part IFC’s regional crises response program. It also is in line with IFC’s strategy for Armenia, which entails supporting the most vulnerable segments of the population by helping microfinance institutions. IFC is a shareholder of INECOBANK, holding 10 percent of its shares. In 2006, IFC provided INECOBANK with a USD 3 million loan to expand mortgage finance, and in 2008 provided a USD 3 million financing package to expand access to finance for small and medium enterprises in Armenia. For more information, in Yerevan:
Narine Hayrapetyan Phone: +37410 545242