THE HAGUE, 03-Aug-2017 — /EuropaWire/ — FMO, the Dutch development bank, extended its partnership with The First MicroFinance Bank, Afghanistan (FMFB-A) through a local currency loan of USD 5 million in Afghan Afghanis from MASSIF, the fund that FMO manages on behalf of the Dutch Ministry of Foreign Affairs.
FMFB-A is the largest microfinance institution in Afghanistan and among the top five commercial banks, operating across 81 districts and 14 provinces and serving 63,000 borrowers and 136,000 depositors. FMFB-A contributes to poverty alleviation and economic development by providing sustainable financial services to small and micro businesses and households in one of the most non-inclusive and least financially penetrated countries in the world. Women in the country have an even more subordinated position with the country ranking in the bottom 10% of the gender equality index.
A long-standing client of FMO and MASSIF, FMFB-A is recognized for its value-led commitment to financial inclusion, emphasis on sustainable development and safeguarding the environment. FMFB-A is the first in Afghanistan and fourth in Asia to become a member of the Global Alliance for Banking on Values (GABV).
FMO’s long-term financing will enhance the balance sheet of FMFB-A through diversified and stable funding. FMFB-A expects to grow rapidly in the coming years and funding is required to finance the institution’s growth, mainly in its services to the unbanked Micro, Small and Medium Enterprises (MSMEs).
“The MASSIF Fund enables us to invest in frontier markets like Afghanistan and to support the built up offinancial institutions. This to enable private sector development and to address financial inclusion. FMFB is an institution that can make a difference and we are very proud to continue our partnership”,noted Jeroen Harteveld, Fund Manager MASSIF.
The USD 5 million-loan equivalent in Afghan Afghanis contributes to economic growth through employment effects in the MSME segment, which is the backbone of the economy of Afghanistan. Moreover, the transaction indirectly advances women’s financial inclusion. FMFB-A is the first bank in Afghanistan to have a female only branch to offer financial services to women. Equality of economic opportunity for women and men is essential for sustainable growth and a key element for building local prosperity.
“I firmly believe that such partnership will further pave the way for low-income households to access banking services in this frontier market. It will foster a more inclusive financial ecosystem in Afghanistan, drawing the underserved into the mainstream of economic activity, harnessing their contributions to society while catalyzing positive changes in their quality of life,” said FMFB-A’s CEO, Frank van der Poll.
About The First MicroFinance Bank, Afghanistan (FMFB-A)
Founded in 2003, The First MicroFinance Bank, Afghanistan (www.fmfb.com.af) is part of the Aga Khan Agency for Microfinance(AKAM), which has programmes in over 10 countries throughout the developing world. FMFB-A’s vision is to be recognized as the leading microfinance services provider contributing to poverty alleviation and economic development through the provision of sustainable financial services primarily targeting micro/small businesses and households. The bank provides credit and deposit products to a wide range of clients including micro, small and medium enterprises along with commercial banking and international remittance services. The bank is also a member of the Global Alliance for Banking on Values (GABV) – an independent network of banks using finance to deliver sustainable economic, social and environmental development. Our values-based banking agenda focuses on providing affordable financial services that promote entrepreneurship, agriculture, incremental housing and clean energy in Afghanistan.