IFC, a member of the World Bank Group, and Goldman Sachs 10,000 Women program launched a $600 million global facility that will increase access to finance to as many as 100,000 women entrepreneurs in emerging markets.
The Women Entrepreneurs Opportunity Facility is the first of its kind to be dedicated exclusively to financing women-owned small and medium businesses in developing countries.
IFC will invest an initial $100 million and the Goldman Sachs Foundation will provide $32 million. IFC will manage the facility, which is expected to mobilize up to an additional $468 million from public and private investors.
The facility is part of the World Bank’s overall strategy to promote gender equality and ensure the social and economic welfare of one-half of the world’s population. IFC, through its Banking on Women Program, is playing a catalyzing role to help women-owned businesses. Since its inception in 2010, the program has made 17 investments totaling more than $800 million in 17 countries.
“This new initiative will create opportunities for tens of thousands of female entrepreneurs to thrive and prosper,” Jim Yong Kim, World Bank Group president said.
“At the World Bank Group, we are committed to providing opportunities to aid women as leaders, business owners, employees, and stakeholders. We cannot afford to exclude half of the world’s population from their rightful role in helping to change the face of the global economy.”
Lloyd C. Blankfein, chairman and CEO of the Goldman Sachs Group, Inc., said: “Through the experiences of the 10,000 Women graduates, we have seen first-hand that investing in women is a key source that leads to economic growth, but there is clearly more that can be done. By partnering with IFC, we will address one of the biggest obstacles to growth for women-owned small and medium businesses: access to capital.”
An estimated $300 billion credit gap exists for women-owned enterprises, according to IFC research. Unfavorable business and regulatory conditions are also among the many barriers that impede women entrepreneurs.
The new facility will extend lines of credits and share risk with local banks in developing countries to help ensure and promote access to finance for women entrepreneurs.
Nena Stoiljkovic, IFC Advisory Services VP and World Bank Group Global Practices VP, said: “IFC is delighted to partner with the Goldman Sachs 10,000 Women initiative, which has an impressive global presence. We need innovative models from the private sector to create opportunities for women entrepreneurs to thrive and prosper.”
IFC and the 10,000 Women program will also provide training and advice to women entrepreneurs. The foundation will provide $18 million in grants—$11 million of which will go to IFC to provide advisory services— to expand financial-planning support for women entrepreneurs.