NewsIFC and Opportunity Bank Support Farmers, Micro and Small Enterprises in Serbia
IFC, a member of the World Bank Group, is providing a RSD 775 million (approximately €6.5 million equivalent) loan to Opportunity Bank Serbia (OBS) to help finance farmers, and micro and small enterprises (MSEs), so they can grow their businesses and generate new jobs. IFC is also providing advisory services to OBS on developing a digitization strategy.
IFC’s first loan in Serbian dinars will help OBS, a leading micro and small business bank focusing on delivering financial services to rural farmers and microenterprises, further expand its portfolio. MSEs account for more than half of employment in Serbia, yet many of them, especially young farmers and young companies, are unable to obtain bank loans because of their lack of credit history. The agriculture sector is also the second largest economic contributor to the country’s GDP.
IFC’s advisory services, meanwhile, will focus on helping OBS digitize its services to improve efficiency and reach new clients.
“Micro and small entrepreneurs and farmers are often excluded from the banking sector, because they have no collateral or credit history, or they’re just considered too small for the high transaction cost,” said Vladimir Vukotic, CEO of OBS. “IFC’s loan and advisory services will help us reinforce our long-term commitment to supporting this segment, as we focus on sustainable growth and further diversifying our MSE portfolio.”
New job opportunities created by the private sector are even more crucial in Serbia today where the government has embarked on a series of reforms of state-owned enterprises. That process will only increase the role MSEs and small scale agriculture can play in creating jobs.
“This is IFC’s first loan denominated in Serbian dinars, eliminating cross-currency mismatches for the borrower,” said Thomas Lubeck, IFC Regional Manager for Central and Southeastern Europe. “IFC’s loan will help expand OBS and widen financial opportunities for local farmers and smaller businesses, while the advisory services engagement will help OBS to start digitizing its operations, in line with international best practices.”
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with more than 2,000 businesses worldwide, we use our capital, expertise, and influence to create markets and opportunities in the toughest areas of the world. In FY17, we delivered a record $19.3 billion in long-term financing for developing countries, leveraging the power of the private sector to help end poverty and boost shared prosperity. For more information, visit www.ifc.org