Indonesia: Citibank, OPIC Lend $19m to Microfinancer Bank Andara
Citibank Indonesia and the Overseas Private Investment Corporation will provide a term loan to Bank Andara to facilitate its efforts to support microfinance businesses, a joint statement from the three companies said on Tuesday.
The $18.5 million loan, which is aimed to promote financial inclusion of micro-entrepreneurs and small businesses in Indonesia, will be disbursed in two periods within six months, the statement said.
“Indonesia is a developing country that is currently facing a rapid growth in its microfinance sector which has a potential opportunity to grow its economy even further, as we know that there are still millions of small business that are lacking of access to banks, financing or microfinance,” Kunardy Lie, Citibank Indonesia head of corporate and investment banking, said in the statement.
OPIC President and chief executive Elizabeth Littlefield said that she anticipates that the loan will help Bank Andara, as a wholesaler to other microfinance institutions, to help low-income households and small entrepreneurs in rural Indonesia.
“The successful deployment of capital, banking services and technology will serve to support the development of financial infrastructure of Indonesia, a priority country for OPIC and the Obama administration,” she said, referring to the US president.
President director of Bank Andara David Yong said: “This credit facility agreement proves strong support and confidence from OPIC and Citibank Indonesia toward Bank Andara’s execution of its mission of financial inclusion through a wholesale financial inclusion model exclusively.”
Bank Andara works with more than 500 microfinance institutions throughout Indonesia and plans to reach 1,400 institutions in the next three years, according to the company.
It is the second time Citibank and OPIC are contributing to the country’s microfinance sector. OPIC is the US government’s development finance institution, which aims to helps US businesses gain footholds in emerging markets and tap growth opportunities both at home and abroad. Citibank Indonesia is the local branch of New York-based Citigroup.
SOURCE: Jakarta Globe