The International Finance Corporation (IFC) has announced a partnership with BRED Bank Vanuatu and BRED Bank Solomon aimed at improving financing access for Small and Medium-sized Enterprises (SMEs) in both nations. This collaboration is focused on driving economic growth and generating job opportunities.
Allen Forlemu, the Acting Regional Vice President for Asia and the Pacific at IFC, pointed out that numerous SMEs in Vanuatu and the Solomon Islands struggle to obtain the necessary capital for their growth and innovation, hampering their economic contributions. The IFC seeks to address this financing gap through strategic investments that aim to boost lending to these businesses while also promoting commercial segment borrowers in the region.
As part of this initiative, an unfunded risk-sharing facility of up to $10 million will be established for BRED Bank in both countries under the Small Loan Guarantee Programme, which receives backing from the International Development Association’s Private Sector Window. This funding is intended to facilitate an increase in the volume of business loans available for SMEs, supported by advisory services from the IFC to aid these enterprises in defining and achieving their growth strategies.
Owen Thomson, the CEO of BRED Solomon Islands, underscored the significant role of BRED Bank as a leading financial institution in Vanuatu, with an expanding footprint in the Solomon Islands. He expressed confidence that this partnership with the IFC, grounded in a history of successful collaborations, will empower BRED Bank to enhance its financing options, thereby directly benefitting the small enterprises that are crucial for economic vitality in these regions.
This collaboration marks an encouraging development in fortifying the financial landscape for SMEs in Vanuatu and the Solomon Islands. It underscores the necessity of investing in small businesses as essential for fostering resilience and encouraging economic progress. By addressing the capital access challenges that these enterprises face, this partnership aims to create a more supportive economic environment conducive to innovation and job creation.