IFC, a member of the World Bank Group, announced new financing of R1.2 billion ($100 million) to support FNB’s lending to small and medium enterprises, with a focus on women-owned businesses.
The financing falls under the IFC SME Push Program, a comprehensive, multi-stakeholder initiative that intends to promote lending and strengthen support for small and medium enterprises by the formal banking sector.
FNB has a pioneering role as the first institution to be financed under the SME Push. The second financing includes a syndicated loan and incentives to reach more women-owned enterprises within the general SME segments, in alignment with World Bank Group and Government of South Africa objectives to reach deeper into the economy. The collaboration includes advisory services to FNB and its SME clients to increase their financial literacy.
Mike Vacy-Lyle, CEO of FNB Business said, “FNB is committed to actively supporting and growing SMEs as an engine of job creation, economic growth and innovation. As the SME bank of choice, our value proposition is based on understanding the challenges that small businesses navigate and offering solutions that remove this everyday angst. At FNB we also appreciate the important role that women-owned businesses play in our economy. We feel that women run businesses require much more airtime and we hope to grow this segment of the market.’
The IFC SME Push Program was launched in June 2017 to channel up to R40 billion ($3 billion) into South African SMEs over the next 5-7 years through a comprehensive package, including investments, risk-sharing facilities and advisory services. The program was developed to complement government policies promoting lending to small and medium enterprises and to spur job creation in South Africa.
Aliou Maiga, IFC Regional Head for the Financial Institutions Group in Africa said, “IFC applauds and supports FNB’s continued expansion of services to small and medium enterprises, with a new focus on women. We look forward to an even stronger partnership to increase our impact South Africans that have been historically disadvantaged and that can make a major contribution to the local economy.”
IFC is working to foster competitiveness and inclusive business approaches in South Africa, supporting efforts by the government of South Africa to reduce inequality, promote investments and strengthen institutions.