IFC Invests in Shinhan Finance to Support Smaller Businesses in Kazakhstan

• IFC provides up to $60 million financing to Shinhan Finance
• 25 percent of the proceeds committed to women-owned small businesses

Almaty, Kazakhstan, October 25, 2023 – To improve access to finance for micro and small enterprises (MSEs) and women-owned small businesses in Kazakhstan, IFC is investing in LLP Microfinance Organization Shinhan Finance (Shinhan Finance). The financing will allow Shinhan Finance to continue providing much-needed longer-term loans and enhance the resilience of smaller enterprises, which are critical for economic growth and job creation.

Up to $60 million financing package, of which the first tranche of $20 million has been committed, will be disbursed in local currency over the next few months to Shinhan Finance. The proceeds will be lent to MSEs, of which at least 25 percent will be earmarked for women-owned small businesses. In addition, IFC supported development and implementation of Shinhan Finance's environmental and social management system, helping build proper capacity to manage its environmental and social risks.

IFC's investment is supported by the performance-based incentive from Women Entrepreneurs Finance Initiative (We-Fi) and the Women Entrepreneurs Opportunity Facility (WEOF) launched by IFC through its Banking on Women business and Goldman Sachs 10,000 Women. WEOF is a first-of-its-kind facility dedicated to expanding access to capital for women entrepreneurs globally. IFC's Banking on Women business as of June 30, 2023 has committed 251 investment and advisory projects with 141 clients in 76 countries, since its launch in 2012. Of these, the WEOF has supported $2.94 billion in commitments to 98 financial institutions in 55 countries.

"As we celebrate the 15th anniversary of Goldman Sachs' 10,000 Women initiative, we remain dedicated to empowering female entrepreneurs to accelerate growth through access to capital," said Charlotte Keenan, Global Director of Goldman Sachs 10,000 Women. "We are pleased to support Shinhan Finance as it expands lending to women-owned small businesses in Kazakhstan."

According to an official from Shinhan Card: "This investment is a significant achievement, as we secured a senior loan from IFC, an international organization with high standards. We hope to further pursue various collaborations with IFC in our global businesses in the future."

While micro, small and medium enterprises (MSMEs) contribute about 27 percent to Kazakhstan's Gross Domestic Product, they have limited access to finance because of insufficient documentation, lack of proven credit history, and issues with property titles on collateral. These businesses' income streams have been severely disrupted by the slowdown in economic activity in the aftermath of the pandemic and further impacted by the geopolitical uncertainty caused by Russia's invasion of Ukraine.

As the economy seeks to recover from these shocks, smaller businesses need access to capital for financing investments in inventory and inputs, resuming economic activity, and adjusting their business models to a post-crisis economic environment. IFC, through its partnership with Shinhan Finance, will help spur growth, create jobs, and reduce poverty in Kazakhstan by supporting underserved segments.

"Financial inclusion is key, and we are committed to ensuring that no business is left behind in the pursuit of a resilient and prosperous economy," said Momina Aijazuddin, IFC Regional Industry Head, Financial Institutions. "Our financing will help expand access to finance to smaller businesses and women entrepreneurs whose contributions are essential for overall economic growth in Kazakhstan, but who are often excluded from the formal financial system."

Shinhan Finance is a subsidiary of Shinhan Card, which is wholly owned by Shinhan Financial Group, headquartered in Seoul, Republic of Korea. On May 24, 2023, IFC signed a Memorandum of Understanding with Shinhan Financial Group for comprehensive business cooperation and this is IFC's first investment with the Group.

In Central Asia, IFC has been ramping up its work to expand financial services and market access for women-led firms. Since 2018, we have invested $155 million in 15 local financial institutions across the region.

In fiscal 2023, IFC made a record investment in emerging markets, which are expected to improve access to finance for MSMEs through the provision of 2.2 million loans.

About IFC

IFC — a member of the World Bank Group — is the largest global 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 2023, IFC committed a record $43.7 billion to private companies 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 impacts of global compounding crises. For more information, visit www.ifc.org.

About Shinhan Finance

Established in 2014, Shinhan Finance is an MFI offering vehicle installment financing and unsecured and secured loans to individuals and legal entities. Shinhan Card, Shinhan Finance's sponsor, is an independent credit card company wholly owned by Shinhan Financial Group (SFG), one of the Republic of Korea's largest financial holding companies with total consolidated assets of $501 billion as of end of 1H 2023. SFG is publicly listed both on the New York Stock Exchange and Korea Stock Exchange with a market cap of ca. $13 billion as of end of 1H 2023. SFG operates in 20 countries across commercial banking, credit card, asset management, and other financial services sectors.

About We-Fi

The Women Entrepreneurs Finance Initiative (We-Fi) is a collaborative partnership among the 14 governments that have made financial contributions, six multilateral development banks that serve as implementing partners, and other public and private stakeholders. We-Fi was formally established in October 2017 as a Financial Intermediary Fund hosted by the World Bank. We-Fi invests in programs and projects that help unlock billions of dollars in financing to address the full range of barriers facing women entrepreneurs—increasing access to finance, markets, technology, and mentoring, while strengthening policy, legal and regulatory frameworks. As one of the We-Fi Implementing Partners, IFC supports private sector clients with investment and advisory services to expand financial services and market access for women-owned/led firms, as well as increasing the capacity of women entrepreneurs to run high-growth businesses. For more information, visit www.we-fi.org.

About Goldman Sachs 10,000 Women

Goldman Sachs 10,000 Women is an ongoing initiative to foster economic growth by providing women entrepreneurs around the world with a business and management education and access to capital. The initiative has reached over 200,000 women from over 150 countries. In partnership with the International Finance Corporation (IFC), Goldman Sachs 10,000 Women launched the first-of-its-kind global finance facility in 2014 to enable access to capital to more women entrepreneurs. The 10,000 Women in-person business education program was launched in 2008, reaching over 10,000 women across 15 countries around the world, and in 2018, the 10,000 Women curriculum was made available online through Coursera, further democratizing access to a business education in more corners of the world. For more information on Goldman Sachs' investment in female entrepreneurs, visit: https://www.goldmansachs.com/citizenship/10000women/

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