Ulaanbaatar, Mongolia, May 8, 2024—To expand digital lending for small and medium enterprises (SMEs) in Mongolia, including women-owned businesses, IFC and M bank, Mongolia's first digitally focused bank with a branchless model, joined forces to launch an innovative program in Ulaanbaatar today. It is part of IFC's ongoing efforts to promote an inclusive and sustainable financial sector in the country.
IFC will provide up to $30 million in financing to M bank, with twenty-five percent of the funding earmarked for SMEs owned by women. As part of the program, IFC has been working with M bank to expand its SME finance and supply chain finance products and services. IFC will also provide technical guidance to help M bank further develop and implement an environmental and social management system.
SMEs, of which two-thirds are women-owned in Mongolia, account for about 70 percent of the country's workforce and 17.8 percent of GDP. Yet access to finance for SMEs in the country remains challenging with only about half of them receiving financing support from banks. According to the World Bank Enterprise Surveys in 2019, 31 percent of surveyed firms in Mongolia face full credit constraints, surpassing the average for other countries in the East Asia and Pacific region.
"At the forefront of digital transformation in Mongolia, M bank is optimistic that our partnership with IFC will further enhance our digital lending capabilities and provide tailored financial solutions to customers across the country," said Temuulen Batmunkh, Deputy CEO, M bank. "We are also excited to pilot specific financial services for local businesses and merchants participating in supply chain."
M bank has rapidly grown since obtaining its commercial banking license in February 2022. With total assets exceeding $200 million and nearly 40,000 borrowers as of December 2023, M bank is wholly owned by MCS Group, one of Mongolia's largest companies, and has a goal to grow by leveraging MCS Group's franchise across the country.
"Mongolia, as the most sparsely populated country, can greatly benefit from digital solutions to expand access to essential services nationwide," said Rufat Alimardanov, IFC Resident Representative for Mongolia. "We are excited to leverage our capital and expertise in supporting a digitally-focused bank in the country to promote market competitiveness and inclusive economic growth."
In Mongolia, IFC has provided $345 million in financing and technical advice to local financial institutions in the past five years.
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
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About M bank
M bank's key focus is to support the financial health of its customers with seamless and innovative financial and non-financial products and services delivered in an easier, comfortable and more accessible manner. In 2023, M bank has secured 230,000 retail customers and 857 business customers those use M bank as a priority bank. In the future M bank will continue to serve most innovative and customer-centric products that fit everyone's lifestyle and financial needs.
For more information, visit www.m-bank.mn
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