November 12, 2010--IFC, a member of the World Bank Group, will take the lead in structuring and facilitating the SME Innovation Finance Fund that was announced at the G-20 Summit in Seoul today. The Fund is a core component of the framework to finance G-20 SME Finance Challenge winners and other models focused on improving finance for small and medium enterprises.
IFC has served as the G-20’s expert technical advisor on SME Finance since the last G-20 Summit in Pittsburgh, where the Group of 20 Leaders committed to increasing financial inclusion by creating the Financial Inclusion Experts Group (FIEG). FIEG’s IFC-led SME Finance sub-group created the SME Finance Challenge, a competition that sought proposals on using public finance to maximize sustainable private SME finance. The Challenge’s 14 winners were announced earlier this month in Washington.
"IFC is taking the lead in structuring and facilitating the SME Innovation Finance Fund because we understand the crucial role these businesses play in development,” said IFC Executive Vice President and CEO Lars Thunell. “We look forward to the announcement of additional commitments to the SME Innovation Finance Fund, and we stand ready to expand our commitment to the G-20 SME Finance agenda in conjunction with other partner organizations.”
IFC is also supporting the G-20 SME Finance agenda through its SME stocktaking report, Scaling-Up SME Access to Financial Services in the Developing World, which was presented to the G-20 leaders in Seoul. The report is a worldwide IFC survey that identifies business models and recommendations to scale up finance to small and medium businesses. It identifies the need for a knowledge sharing/monitoring platform to further identify and promote best practices across countries and institutions, establish baselines, monitor progress, and promote collaboration in support of SME finance development.
The new Global Partnership for Financial Inclusion, led by the Alliance for Financial Inclusion, IFC, and the Consultative Group to Assist the Poor, also was announced in Seoul. The partnership will help countries put into practice the principles for financial inclusion, strengthen data for measuring financial inclusion, and develop methodologies for countries wishing to set targets for increasing access to financial services.
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