IFC offers a wide variety of financial products to private sector projects in developing countries. In order to be eligible for IFC funding, a project must meet a number of IFC criteria:
The project must be located in a developing country* that is a member of IFC.
It must be in the private sector.
It must be technically sound.
It must have good prospects of being profitable.
It must benefit the local economy.
It must be environmentally and socially sound, satisfying IFC environmental and social standards as well as those of the host country.
A company or entrepreneur, foreign or domestic, seeking to establish a new venture or expand an existing enterprise can approach IFC directly by submitting an Investment Proposal. After this initial contact and a preliminary review, IFC may proceed by requesting a detailed feasibility study or business plan to determine whether or not to appraise the project.
The proposal can be submitted to an IFC industry sector department or to an IFC regional department at IFC headquarters in Washington, DC. To determine to which department to submit the proposal, read more about IFC's Corporate Structure. The proposal can also be submitted to the IFC field office that is closest to the location of the proposed project.
Government Cooperation
Although IFC is primarily a financier of private sector projects, it may provide finance for a company with some government ownership, provided there is private sector participation and the venture is run on a commercial basis. Although IFC does not accept government guarantees for its financing, IFC's work often requires close cooperation with government agencies in developing countries.
Pricing and Financing Ceilings
To ensure the participation of investors and lenders from the private sector, IFC limits the total amount of own-account debt and equity financing it will provide for any single project. For new projects the maximum is 25% of the total estimated project costs, or, on an exceptional basis, up to 35% in small projects. For expansion projects IFC may provide up to 50% of the project cost, provided its investments do not exceed 25% of the total capitalization of the project company.
IFC provides a wide variety of financial products and services to its clients and can offer a mix of financing and advice that is tailored to meet the needs of each project. However, the bulk of the funding, as well as leadership and management responsibility, lie with private sector owners.
Like other private sector investors and commercial lenders, IFC:
Seeks profitable returns.
Prices its finance and services in line with the market.
Fully shares risks with its partners.
* Projects in sectors such as information technology may be located in an industrialized country if the benefits of the project primarily accrue to a developing country or countries.