|
|  |
| PEF Student Loan |
|
| Summary of Proposed Investment |
| This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
| Project number | 26766 |
| Company name | Bank of Palestine |
| Country | West Bank and Gaza |
| Sector | Education Services |
| Environmental category | C |
| Department | Global Financial Markets Group |
| Status | Pending Disbursement |
|
| Date SPI disclosed | April 11, 2008 |
| Projected board date | May 12, 2008 |
| Previous Events | Signed: June 19, 2008
Approved: June 6, 2008 |
|
| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
| Palestinian Education Fund and IFC are planning to establish a risk-sharing student loans facility in the West Bank and Gaza. The Facility will be used to provide loans to students who have difficulty affording the upfront tuition fees for their tertiary education, thus providing them with up to 8 years to pay these fees. This will be the first private student loan financing facility in the Palestinian Territories. The student loans originated under the Facility will be funded and serviced by a local bank, with whom IFC will assess the credit risk. It is part of IFC’s strategy to develop student loans. |
|
| Project sponsor and major shareholders of project company |
| The Palestinian Education Fund is a new Fund being created to address the increased level of college drop outs due to financial constraints. Increasingly, students in the Palestinian Territories are finding it difficult to ensure university fees on a constant basis and parents are increasingly unable to obtain debt or find financing sources for tuition fees. PEF’s vision is “to contribute in a proactive and positive manner to the investment in young Palestinian leaders via education.” The Fund plans to make education accessible by providing financial intermediation with the aim to assist students in financial need via loans. |
| Total project cost and amount and nature of IFC's investment |
| The proposed IFC investment is in the form of a risk sharing facility with the local bank. The size of the facility is expected to reach 15,000 students over the 3 year period. |
| Location of project and description of site |
| The facility will be available for students studying at traditional universities in the West Bank and Gaza. The local bank will have a branch network that can serve the target student population in both locations. |
|
| Anticipated development impact of the project |
The project will have a strong development impact by:
- Improved access and increased affordability for higher education for students in the West Bank and Gaza
- Change culture of non-payment and foster ownership of one’s education
- Reduce family burden to pay for children’s higher education
- Provide universities with more reliable and increased tuition fee collection mechanism
- Enable future students to participate in higher education with minimum budget contribution from the government through a revolving student loan facility |
 |
| IFC's expected development contribution |
| This student loan facility project is encouraging private investment in the education infrastructure in the West Bank and Gaza. IFC will also be supporting financial sector activities by working with a local bank to develop an innovative new student loan facility. Through its role in structuring this student loan facility and by leveraging resources of third parties to target education finance, IFC is supporting its strategy for The Palestinian Territories. |
| Environmental and social issues - Category C |
| IFC's review of this investment has determined that it is anticipated that this student loan facility will have minimal or no adverse social or environmental impacts. Based on this review, the investment is categorized as C and no further analysis is required. |
|
| For inquiries about the project, contact: |
Rana Jadallah
Palestine Education Fund
Paltel Group, PO Box 636, Ramallah, West Bank
Telephone: 970 2 2944103
Fax: 970 2 2350453
E-mail: rana.jadallah@paltelgroup.ps |
|
| For inquiries and comments about IFC, contact: |
General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster |
|
|
|
|
|