OPIC Signs Commitment with XacBank to Support Women-owned SMEs in Mongolia through Goldman Sachs 10,000 Women and IFC Partnership
April 25, 2017
WASHINGTON – The Overseas Private Investment Corporation (OPIC) has signed a commitment with XacBank LLC, a leading commercial bank in Mongolia, to support access to finance for women-owned small and medium sized (SME) businesses in Mongolia as part of an IFC-led syndication.
OPIC signed a commitment to provide $49 million in financing to XacBank as part of the Women Entrepreneurs Opportunity Facility, a joint partnership between Goldman Sachs 10,000 Women and IFC’s Banking on Women program to increase access to capital for up to 100,000 women entrepreneurs.
In Mongolia, while 64 percent of SMEs are women-owned, the majority are underserved or unserved by financial institutions. SMEs in Mongolia face higher interest rates, fees, and collateral requirements compared to other Asian SMEs. Women-owned SMEs in particular have demonstrated lower levels of borrowing, which has inhibited growth.
An IFC survey of Mongolian SMEs revealed that access to finance is the primary obstacle faced by Mongolian SMEs in establishing and growing their businesses. While 98 percent of SMEs surveyed by the IFC expressed an interest in receiving financing, only 50 percent of SMEs have been able to access financing.
This loan will be used to provide women-owned businesses access to finance to expand their businesses. The project will leverage Goldman Sachs 10,000 Women and IFC’s joint Women Entrepreneurs Opportunity Facility (WEOF) to promote access to finance and financial literacy of women-owned businesses in developing countries.
The Overseas Private Investment Corporation (OPIC) is a self-sustaining U.S. Government agency that helps American businesses invest in emerging markets. Established in 1971, OPIC provides businesses with the tools to manage the risks associated with foreign direct investment, fosters economic development in emerging market countries, and advances U.S. foreign policy and national security priorities. OPIC helps American businesses gain footholds in new markets, catalyzes new revenues and contributes to jobs and growth opportunities both at home and abroad. OPIC fulfills its mission by providing businesses with financing, political risk insurance, advocacy and by partnering with private equity investment fund managers.
OPIC services are available to new and expanding businesses planning to invest in more than 160 countries worldwide. Because OPIC charges market-based fees for its products, it operates on a self-sustaining basis at no net cost to taxpayers. All OPIC projects must adhere to best international practices and cannot cause job loss in the United States.
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with 2,000 businesses worldwide, we use our six decades of experience to create opportunity where it’s needed most. In FY16, our long-term investments in developing countries rose to nearly $19 billion, leveraging our capital, expertise and influence to help the private sector end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org.
Setting the standard for corporate governance and social responsibility, XacBank embraces the triple bottom line mission of People, Planet, and Prosperity. With the vision to bring world class financial services to Mongolia, XacBank operates with over 1,300 specialized staff, 86 branches across the country, and over 2,700 merchants. As well as proudly delivering full banking products and services to its 700,000 customers through latest digital channels.
About Goldman Sachs 10,000 Women
The Goldman Sachs 10,000 Women initiative is a campaign to foster economic growth by providing women entrepreneurs around the world with business and management education and access to capital. The initiative has reached women from across 56 countries through a network of 100 academic, non-profit, and bank partners. In partnership with the International Finance Corporation (IFC), Goldman Sachs 10,000 Women launched the first-ever global finance facility in 2014 to enable up to 100,000 women entrepreneurs to access capital.