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Ramallah, West Bank, April 28, 2011—IFC, a member of the World Bank Group, is supporting micro and small businesses and encouraging job creation in the West Bank and Gaza through a $3 million loan to Palestine for Credit and Development—known as Faten—a leading microfinance institution.
As of March 31, 2011, Faten had more than 12,000 clients, of which 80 percent are women, and a total outstanding portfolio of $24 million. With IFC’s help, Faten plans to reach 22,000 customers and develop a net outstanding portfolio of $33 million by 2015.
“We consider this engagement with IFC as the start of a long-lasting and fruitful strategic partnership,” said Faten Managing Director Anwar Jayyosi. “This project will help us continue to expand our microfinance services to low-income yet active Palestinians and prove that the microfinance sector in West Bank and Gaza is worth investing in.”
IFC’s loan will help Faten expand its outreach in West Bank and Gaza, where 80 percent of employment is generated by micro, small and medium enterprises. The project will be complemented by IFC’s advisory services to strengthen Faten’s operations and share international best practices so the firm can continue to serve its market. Some 70 percent of the population in the Palestinian territories is under 30 years old, and 57 percent of people live below the poverty line.
“Despite West Bank and Gaza’s challenges, there remain plenty of enterprising people that require improved access to finance to turn their ideas into viable small businesses,” said K. Aftab Ahmed, IFC Director for Global Financial Markets and private Equity Funds in Europe, Central Asia, Middle East and North Africa. “We believe our involvement with Faten will help reach more of those aspiring entrepreneurs while encouraging others to invest, help create jobs and grow the economy in this challenging market.”
West Bank and Gaza’s unstable political and security situation over the last decade has constrained microfinance providers’ ability to secure long-term funding and, as a result, only an estimated 20 percent of the territories’ microfinance needs are currently being met, despite West Bank and Gaza’s considerable potential for growth.
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in developing countries. We create opportunity for people to escape poverty and improve their lives. We do so by providing financing to help businesses employ more people and supply essential services, by mobilizing capital from others, and by delivering advisory services to ensure sustainable development. In a time of global economic uncertainty, our new investments climbed to a record $18 billion in fiscal 2010. For more information, visit www.ifc.org.
Faten is a non-profit company and one of the pioneering microfinance providers in the West Bank and Gaza. It was established in 1999 with a mission to provide financial services to small and micro enterprises and a goal of empowering families and developing the community. Since inception, Faten has disbursed 93,000 loans, 80 percent of them to women, with total disbursements of $100 million. For further information, visit: www.faten.org.