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Apr 3, 2023

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FMO signs USD 11 million NASIRA guarantee to NMB Bank

FMO signs USD 11 million NASIRA guarantee to NMB Bank

FMO is pleased to announce a USD 11 million NASIRA risk sharing facility for NMB Bank in Tanzania. This facility will be used to support the bank in increasing financing for Micro, Small and Medium-sized Enterprises (MSMEs) operating in Tanzania.

FMO’s NASIRA risk-sharing program supports financial institutions to increase financing for MSMEs with a focus on underserved business segments, such as women and youth-owned businesses, who often remain underbanked, due to high risks. The program narrows the financing gap for these groups by sharing possible credit losses with the financial institutions and thereby reduces the risk involved.

NASIRA is supported by the European Commission and the Dutch government and was launched in August 2020. Since then, 11 transactions have been signed with financial institutions across Africa, Middle East and Central Europe for a total of USD 270 million. East Africa has been a strategic focus of the program with USD 80 million signed transactions to date. This facility with NMB Bank is the first in Tanzania.

FMO will be providing NMB Bank with a revolving unfunded portfolio guarantee covering the bank’s MSME loan portfolio up to a maximum of USD 11 million. NMB Bank has a strong focus on financing MSMEs with the guarantee specifically focusing on MSMEs within the agriculture value chain, women & youth-owned businesses.

Marnix Monsfort, Director Financial Institutions of FMO, said: “We are very pleased to sign this Nasira Facility with NMB at the EU-Tanzania Business Forum. NMB is a long-standing strategic partner, focused on financing micro and small enterprises in Tanzania. With this Nasira risk-sharing facility, enabled by the European Commission and the Dutch Ministry of Foreign Affairs, we are able to support NMB in financing those groups who face the most challenges in accessing formal bank financing, such as entrepreneurs in the agriculture value chain, women and youth-led businesses.”

Aziz Chacha, Treasurer, NMB Bank said: “NMB and FMO have a long-standing strategic partnership, this guarantee facility comes at the right time as we advance our support as a financier to the MSMEs segment which is mostly occupied by women and youth-led businesses. We aim not only to offer financing under this Nasira risk-sharing program but also to design products and services working with FMO that will allow the inclusion of these entrepreneurs in the banking industry. Ultimately, create job opportunities and positively transform their livelihood.”

For more information visit www.fmo.nl

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