Acba Bank and IFC to allocate $50 million for MSME  development in  Armenia

ArmInfo.As a result of a new partnership between Acba Bank and the International Finance Corporation (IFC),  ACBA will allocate $50 million to finance and develop micro, small and medium enterprises (MSMEs) in Armenia, as noted in a statement by Acba Bank.

According to the explanation in the statement, this means that IFC  will share the risk of repayment of up to 50% of loans provided by  Acba Bank in the amount of $50 million. (we are talking about the  risk sharing facility - ed.). This partnership will allow Acba Bank  to further expand its financing to micro, small and medium  enterprises in Armenia.  "This new partnership with IFC is an  important project. It is aimed at supporting MSMEs. The program is  about sharing risks. IFC thus supports us to be bolder, to actively  and boldly finance micro, small and medium enterprises. I believe  that we can allocate these funds very quickly," said Hakob  Andreasyan, CEO of Acba Bank.

"This risk-sharing partnership with Acba Bank is important for  Armenia, as it supports the country's sustainable and inclusive  development. With this project, we will contribute to the financing  of micro, small and medium enterprises in Armenia, in particular, by  addressing the challenges they face in attracting financial  resources. It is very important that women-owned businesses also  benefit from the partnership, as barriers to financing are  particularly pronounced in women-owned SME sector, in rural areas,  and in agribusiness," said Marcelo Castellanos, Senior Regional  Manager, IFC's Financial Institutions Group in Europe.

It should be noted that the International Finance Corporation (IFC)  is a member of the World Bank Group, focused on the private sector in  emerging markets. It works in more than 100 countries, using its  capital, experience, and influence to create markets and  opportunities in developing countries. In fiscal year 2024, IFC  committed a record $56 billion to private companies and financial  institutions in developing countries, leveraging private sector  solutions and mobilizing private capital to create a world free of  poverty on a livable planet.  The project mentioned above is part of  IFC's Small Loan Guarantee Program supported by the European Fund for  Sustainable Development (EFSD) of the European Commission. This  program combines the efforts of IFC and partner financial  institutions to use a risk-sharing facility aimed at assisting small  businesses in reducing financial risks. According to the Financial  Rating of Armenian Banks as of September 30, 2024, prepared by  ArmInfo Investment Company, Acba Bank ranks in the TOP-3 for lending  to SMEs with a volume of $619 million. Acba Bank holds over 15% of  the total volume of these loans in the market, and the share of SME  loans in the banks total loan portfolio exceeds 43%. The total volume  of these loans in the banking market exceeds $4 billion.