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Agency Lines
IFC should support the agent by providing manuals and training courses and monitor the agent to ensure environmental and other guidelines are being followed. Best results may be achieved if the tasks allotted to the agent are kept simple. 2. IFC Resources: The project screening and implementation work associated with agency lines is significant to the extent that secondment of IFC staff or technical assistance is often required, at least during the project's initial period. IFC should carefully consider its ability to provide staff and other necessary resources. 3. Financial incentive: IFC should ensure that the financial incentive to the agent is sufficient for the agent to implement the agency line versus pursuing its traditional business, or financing the strongest projects itself. 4. IFC staff changes: The frequent changes in IFC staff supervising an agency line have caused delays in sub-project approvals, the release of funds to borrowers and have led to a lack of monitoring. IFC should not allow such staff changes to cause these delays. 5. Structuring agency lines: IFC should allow for flexible, risk-based pricing of loans to SMEs. IFC should not be locked into the original operational concept if improvements can be made along the way. Further, IFC should allow greater latitude to its field offices in the analysis and decision making process associated with such projects. 6. Size of agents: IFC should ensure that the financial institution selected has prior experience of financing SMEs. Smaller banks are more likely to have such experience and may place a higher value on a relationship with IFC than larger banks.
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