BIO boosts investments in Cambodia

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29.07.2010
Microfinance helping rural economy.
BIO recently supplied Prasac and Sathapana, two leading microfinance institutions (MFI) in Cambodia, with new loan facilities amounting to USD 4 million each. Both are well-established institutions in the country and play an essential role in providing financial services to the rural economy. These investments will consolidate BIO’s role in supporting the microfinance sector, which has proven to be a key sector in the economy of Cambodia, one of the poorest countries in South East Asia.

Generally, local financing is hardly available to MFIs. Hence attracting international funding from DFIs or international social investors is the only way to back their activity. BIO and other investors play a catalyst role by demonstrating the viability of MFIs and encouraging other international or local fund providers to consider them as key potential clients.

Prasac and Sathapana are in the top 4 of MFIs in Cambodia. They mainly lend to individuals and a great portion of their clients are women (98% for Prasac and more than 70% for Sathapana). They play a leading role in expanding access to financial services, by servicing the lower income population, promoting entrepreneurship and allowing poor clients to enter the economic activity.

Both MFIs already benefit from previous financing facilities by BIO (BIO is also a shareholder of Prasac) and have proven their resilience and sustainability over the years. The new loan facilities will help them further fuel their growth and consolidate their portfolio.

BIO strongly believes in the impact of a solid and professional microfinance sector and has built a sound microfinance portfolio over the years in low income countries all over the world. These new investments confirm BIO’s confidence in the ability of MFIs to provide financing to people who have the competences and skills but lack financial resources to develop a sustainable economic activity and contribute to the prosperity of their country, community and family.

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