FINCA Microfinance Bank Pakistan has announced that it has secured an 8-year, Rs. 800 million Tier II subordinated bilateral loan facility from Pakistan Microfinance Investment Company (PMIC). The facility marks an inaugural Tier 2 transaction by PMIC and will be used by FINCA Pakistan to support its balance sheet expansion.
The facility will contribute towards FINCA’s Tier II Capital for complying with the Capital Adequacy Ratio (CAR) requirement prescribed by the State Bank of Pakistan for Microfinance Banks. The funds raised will be utilized in FINCA Pakistan’s business operations and will enable the bank to meet financing requirements of over 240,000 borrowers across Pakistan. Most of these loans will be targeted towards individuals running micro, small and medium-sized enterprises.
Zarlasht Wardak, Chairperson of FINCA Pakistan board, congratulated both institutions on this landmark transaction. “Pakistan is full of opportunities for microfinance sector and we are very happy that this facility will allow us to farther our mission of financial inclusion and improving access to finance for disadvantaged sections of the economy”, she said.
Speaking on the occasion, PMIC CEO Yasir Ashfaq said,
PMIC is dedicated to promoting financial inclusion across Pakistan. In this regard, PMIC has developed and offers a range of financing services to Microfinance Banks and Non-Banking Microfinance Institutions (NBMFIs). With this partnership, PMIC and FINCA Pakistan are aiming to improve the financial inclusion indicators of the country and contribute towards the National Financial Inclusion Strategy.
Farid Ahmed Khan, Acting CEO FINCA Microfinance Bank said,
We are excited to enter this new partnership with PMIC. This loan facility will enable us to expand our product offering across the country while continuing to help the people of Pakistan build assets, create jobs and improve their standard of living.
FINCA Pakistan has over half a million clients which are serviced by its branchless banking platform and 132 branches all over the country. The bank has been one of the fastest growing microfinance institutions in Pakistan and its balance sheet has grown 134% in the last three years.