The Industrial Development Bank (IDB) signed an agreement with Tamweely Microfinance to provide a new financing package worth EGP 50m to re-lend it to projects for low-income groups and the most vulnerable groups in society.
The new agreement aims to reach 8,000 clients in Egypt to curb unemployment, create jobs, and improve the income of households.
According to IDB Chairperson and Managing Director, Maged Fahmy, the protocol comes in the framework of the bank’s track record in supporting development projects aimed at reaching marginalised and lower-income groups and integrating them into the formal economy and enhancing the financial inclusion currently being adopted by the state.
He added that the bank played an important role in supporting micro, small, and medium enterprises (MSMEs). The sector’s portfolio reached EGP 2.8bn and EGP 600m indirectly, bringing up the total to EGP 3.4bn, in addition to EGP 750m in the pipeline. The bank secured funding for 100,000 micro projects worth EGP 1.2bn, ranking fourth among banks in Egypt in financing the sector.
Fahmy praised Tamweely’s great success in supporting micro enterprises as one of the most promising companies in this field, as well as the great efforts of the bank’s small business sector to support micro enterprises and financing alone—the first commodity exchange in Egypt and the Middle East—as well as funding Rubiky City and Damietta Furniture City, along with the initiative of ‘Your Factory is Ready with Licenses,’ in coordination with the Industrial Development Authority.
According to Hamdy Azzam, deputy chairperson of the bank, the new agreement with Tamweely strengthens the bank’s success in micro and small projects. IDB signed 14 contracts with the Micro, Small, and Medium Enterprise Development Agency (MSMEDA) for a total value of EGP 572m, the latest of which was a protocol to inject EGP 100m of funding within the Bashayer ElKher project.
Azzam pointed out that the bank aims to obtain an appropriate share in the financing of such projects, to boost funding up to EGP 5bn in 2019.
For his part, Amr Abou El-Azm, Chairperson and Managing Director of Tamweely Microfinance, he said that the new agreement is in line with the company’s expansion plan to support these projects and its duty to develop society, combat unemployment, improve living standards, and help customers in this sector to develop their projects. In addition, the company aims to fulfil the desired profits and the transformation of energy of the youth into productive positive energy which contributes to the improvement of national income.
He confirmed that his company succeeded in obtaining EGP 200m from four banks in 2018 to re-lend them to micro projects, as a first step towards obtaining a fund of EGP 1.4bn in three years, of which 35% will be directed to women.
Ahmed Khorshid, Managing Director of Tamweely, said that his company has recently participated in supporting financial inclusion and integrating more people into the formal economy. The company is seeking to increase the figure through an ambitious plan to grow the number of branches from the current 13 to 60 branches by 2020.