Alliance Finance Company PLC

Development impacts

• Local economic growth

  Credit to MSMEs: Funding the growth of AFC's productive portfolio by channeling 100% of BIO's use of proceeds toward (mostly informal) micro and small enterprises through dedicated products financing vehicles and equipment, thereby allowing to scale the total gross loan portfolio by 16% per year over the next 5 years (from USD 233M) - as of today, 51 % of the loans are for productive use (with 37% of micro and 14% of small enterprises) while  the remaining 49% of loans also include vehicles utilized by micro-entrepreneurs.  Savings mobilization: Supporting a NBFI that is a strong deposit-taking institution serving 7,237 depositors (77% of USD 118M through terms deposits from individuals and 86% from the Colombo capital province that constitute 47% of AFC's balance sheet, thereby strengthening its stable funding base and transferring capital from urban to rural areas. 

• Private sector consolidation/innovation

  Sustainable finance: Supporting the oldest NBFI in Sri Lanka that issued the country's first green bond (USD 3.1M equivalent funding renewable energy and energy efficiency) and social bond (USD 6.6M equivalent in September 2025, with 75% to MSMEs and 25% to microfinance clients), while demonstrating structural integration of sustainability considerations through its triple-P framework (People, Planet, Profit).  Impact-oriented expansion: Implementing an expansion plan with clear impact goals (i) lead the transition towards sustainable mobility solutions, (ii) drive financial inclusion, (iii) promote MSME development, while expanding to new districts and consolidating its unique outreach. 

• Financial inclusion

  Un(der)served segments: Targeting mostly informal and unbanked individuals and MSMEs in rural areas through tailored loan products with relatively small entry tickets - including leasing, gold loans and to a lesser extent joint liability group lending (piloting in the underserved northern region with 2,670 clients) - reaching over 100,000 active borrowers and providing 50,000 loans to microenterprises with an average loan size of USD 2,100 and mostly used to acquire second-hand two-wheelers, three wheelers or other vehicles. 

• Food security & rural development

  Rural focus: Targeting rural areas through two-thirds of the 91 branches in rural areas and serving rural clients who comprise 78% of the portfolio and 69% of outstanding loan balances (alongside 19% peri-urban clients), while dedicating 12% of its portfolio (18,697 loans; USD 25M) formally deployed in the agricultural sector including through specific products. 

• Fight against climate change

  Green lending: Scaling climate portfolio that encompasses 997 projects (64% electric vehicles, 28% solar, 8% agriculture) and target 11% of GLP by 2030, with BIO dedicating 20% of loan proceeds (USD 5M, approximately 2.5% of GLP) to green loan products that enable MSMEs and households to finance renewable energy, electric mobility, and sustainable agriculture initiatives.  Climate strategy: Promoting comprehensive climate integration through assessment of climate risks and opportunities, annual emission reduction targets across Scopes 1, 2, and 3 for five years, commitment to Scope 1 & 2 carbon neutrality by 2030, carbon footprint verification and greenhouse gas emission statements to enhance transparency and accountability.