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Cambodia: Supporting the financial inclusion of the most vulnerable
Project
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Signature date
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Location
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Cambodia
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Financing tool
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Financing amount (Euro)
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7129489.35
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Financing details
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USD 8m loan
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Customer
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LOLC (Cambodia) Plc
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Type of customer
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Microfinance
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Country of headquarters
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Cambodia
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Project number
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PKH1044
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Environmental and social ranking
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IF-C
This information is given at the time of signature, without prejudice to any developments in the operation/project.
Proparco’s loan is supporting the development of a responsible microfinance institution, which is certified Smart Campaign and active among women, rural communities and the poorest.
Client presentation
LOLC is Cambodia’s 4th largest microfinance institution by the number of clients served and the size of its loan portfolio. LOLC was certified Smart Campaign in July 2016 and mainly targets the low-end market segment with a strong presence in rural areas
Project description
The project involves the allocation of a USD 8m senior credit line to the Cambodian microfinance institution (MFI) LOLC Cambodia (“LOLC”) to support the development of its loan portfolio.
LOLC has been financed by Proparco since 2012. At the time it was operating under the name “TPC” and had received EUR 2.25m of senior debt financing.
This project is part of the 2X Challenge initiative. This multi-stakeholder initiative aims to support projects that empower women as entrepreneurs, business leaders, employees and consumers of products and services, and increase their participation in the economy.
This initiative thus contributes to Sustainable Development Goal #5 (Gender Equality).
Project impact
On the economic front, the project will contribute to the financial inclusion of vulnerable populations. Its clients are all micro-entrepreneurs active in the sectors of agriculture (some 60%), trade and services. The MFI continues to support the poorest rural communities: 75% of clients are women, 93% are in rural areas, 33% are below the poverty line.
On the social front, the project will support employment and training for local communities. Proparco’s financing will support some 13,000 indirect jobs (e.g. with the MFI’s clients). The project will support the creation of or secure jobs for a total of some 17,000 people in Cambodia.