The European Bank for Reconstruction and Development said it approved a €4 million loan for on-lending to local private businesses to a Bosnian microfinance organization. Mikrofin currently has a network of 75 branches in Bosnia and working with the lender will allow the EBRD to widen and deepen its outreach to extend finance where it is often needed most, the Bank said.
The loan is complemented by technical cooperation support financed by the EBRD Shareholder Special Fund to support Mikrofin with the development of the methodology and implementation of the new IFRS 9 standard, in order for the microfinance organization to comply fully with the IFRS. The adoption of the new IFRS standard will ensure that Mikrofin maintains access to funding from external lenders and send a strong signal to the whole financial sector, the EBRD said.
Ian Brown, EBRD Associate Director, Head of Bosnia and Herzegovina, said: “Building on the strong relationship we have established with Mikrofin over the past 10 years, we are pleased to extend these new funds to the microfinance institution. Our goal is to strengthen the real economy in the country by facilitating access to finance for those vibrant enterprises which will drive future growth and prosperity.”
The micro-sized and small enterprise segment is a vibrant part of the Bosnian economy and the country’s engine of growth and job creation, the EBRD said.