Working with local financial intermediaries allows IFC to support far more micro, small, and medium enterprises than we would on our own.

IFC is committed to the World Bank Group goal of achieving universal access to finance by 2020.

In order to do this, IFC works with about 800 financial institutions with products including investment and advisory support for microfinance, insurance, loans to small and medium enterprises and women-owned businesses, and low- and medium-income mortgages.

Our work in more than 100 countries has helped strengthen financial institutions and systems, reinforcing responsible finance, enabling them to play a constructive role in economic growth, and introducing environmental and social standards in many clients for the first time.

In fiscal year 2018, IFC clients, directly or indirectly, were able to provide over 8 million loans to small and medium enterprises worth a total of $365 billion, and 54 million micro-loans to individuals, worth $74 billion..

Our expertise and advice help our clients address systemic issues such as risk management, corporate governance, and the introduction of environmental and social standards. We also encourage financial institutions to become more involved in strategic sectors that are important to the development agenda, including women-owned businesses, trade finance, climate change, and agri-finance, and underserved regions such as fragile and conflict-affected states.

 

Definition of Targeted Sectors

Use of proceeds of IFC’s targeted FI investments are primarily directed to micro, small and medium enterprises (MSMEs), women-owned businesses, climate-related projects and housing finance. To learn more about how these sectors are defined for the purpose of IFC’s investments click here.

IFC WORKS WITH FINANCIAL INTERMEDIARIES TO SUPPORT:

  • Access to Essential Financial Services

    IFC works with financial institutions to increase inclusion in their products and services; among these are insurance, agricultural finance and housing loans. These products and services help people and businesses build assets, increase income and reduce their vulnerability to economic stress. As stabilizing forces, such financial staples are critical to fighting poverty and boosting prosperity.

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  • Banking on Women

    IFC provides financing and expertise to financial institutions to help them attract women-owned SMEs and retail customers—and profitably finance them.

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  • Climate Finance

    Enabling emerging markets to mitigate and adapt to climate change is a strategic pillar for IFC and the World Bank Group. IFC’s Financial Institutions Group partners with banks and other financial institutions (200 to date, with climate finance portfolios of approximately $26 billion) to fund the urgent need for at least $23 trillion in climate-smart investments. These are necessary to keep temperatures within 2 degrees Celsius above the pre-industrial average and to make the global economy more resilient to climatic extremes. By supporting financial institutions in deploying climate finance, we help to reduce greenhouse gas emissions while supporting businesses’ bottom line.

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  • Digital Finance

    IFC aims to increase the reach and breadth of financial services to people and businesses who currently have little or no access to such services—and our goal is to do so on a massive scale. Technology is helping by bringing down costs and creating new opportunities to reach un- and underserved market segments, such as micro-, small and medium-sized enterprises and smallholder farmers. IFC supports its financial-institution clients in building out their digital infrastructure as well as online financial products and services. This way, the institutions can expand the reach and reduce costs of their services. They can also develop new asset classes, which IFC often underwrites.

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  • Fintech

    Fintech is redefining financial services, and IFC has helped steer these changes in emerging markets for more than 10 years. While IFC’s Digital Finance unit provides advisory services to help banks and other financial institutions reach unbanked populations, our Fintech group invests in technology-driven innovation in financial infrastructure, products and services. With growth and expansion capital, sectoral knowledge, global expertise and convening power, IFC provides committed guidance to our Fintech partners.

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  • Global Trade

    Trade is the lifeblood of the world economy, and IFC works to ensure that businesses in emerging markets can be included in the global economy, bringing in essential imports and exporting to boost economic growth.

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  • Microfinance

    Micro, small, and medium enterprises play a major role in creating jobs and boosting prosperity for low income people—fostering economic growth, social stability, and the development of a dynamic private sector. Having adequate access to finance is fundamental for these companies to flourish.

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  • SME Finance

    Small and medium enterprises (SMEs) promote the economic and social development of emerging markets by generating income and jobs. SMEs create between 70 and 95 percent of new employment opportunities in emerging economies. These firms are more likely to generate jobs, and at a faster pace, when they have access to finance. IFC helps expand access to finance while also using advisory services to increase financial intermediaries' positive impact on the SME sector.

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