IFC believes that sound, inclusive, and sustainable financial markets are essential to building shared prosperity and ending extreme poverty. Our work with financial intermediaries in more than 120 countries has helped strengthen financial institutions and overall financial systems, enabling them to play a constructive role in economic growth.
Working with financial intermediaries allows IFC to support far more micro, small, and medium enterprises than we would be able to on our own. In FY12, our financial-intermediary clients helped us provide loans to 25 million individuals and 1.5 million small and medium sized enterprises.
Access to finance is a key barrier to the growth of SMEs and the establishment of microenterprises. The Access to Finance gap in emerging markets is large- 2.5 billion adults do not have access to savings or credit, and 200 million MSMEs do not have access to credit.
Working through financial intermediaries, enables us to encourage them to become more involved in sectors which are strategic priorities such as women owned businesses, climate change and agriculture and in underserved regions such as fragile and conflict affected states as well as in housing, manufacturing, infrastructure and social services. Our work with these clients has supported an estimated 100 million jobs. See IFC and Job creation website.
Through its Advisory Services, IFC has also scaled up the sustainable provision of financial services in developing countries by addressing systemic issues such as credit information and credit bureaus, improvements in risk management, corporate governance and the introduction of environmental and social standards.
IFC’s approach to environmental and social risk management (E&S) helps build the capacity of our financial-institution clients to assess and mitigate their own E&S risks, in a manner commensurate with the level of exposure to such risks. Our 2012 update to the IFC Sustainability has strengthened our risk management and transparency with regard to our financial-institution clients.
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FINANCIAL MARKETS
We focus on small and medium enterprises, microfinance, trade, and climate change, among others. IFC is a leading investor in microfinance. We create innovative products in insurance and supply-chain finance to reach the poor. We are rebuilding our investments in housing finance and are supporting capital-market development in light of the global financial crisis.
ADVISORY SERVICES
Access to Finance Advisory services help increase the availability and affordability of financial services for individuals and micro, small and medium enterprises. Our advisory services often accompany the financial investments, giving clients the benefit of in-house expertise from seasoned sector specialists. We also partner with consultants familiar with local conditions to provide solutions suited to the unique characteristics of a particular country. Our projects include assistance to banks and specialized financial institutions in improving their ability to provide financial services to micro, small, and medium enterprises.