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Thematic Area:

SME Banking & Development

Duration:            

2015 – ongoing

Client:                

European Bank for Reconstruction & Development (EBRD)

Region:             

Middle East & North Africa

Country Coverage:           

Jordan

Project Overview

Although Micro, Small and Medium-sized Enterprises (MSMEs) are a major part of the economy in Jordan, MSME access to financial services remains limited. To help enable MSMEs drive economic growth in Jordan, the EBRD launched a framework of up to USD 150 million in senior loans and loan guarantees to Participating Financial Institutions (PFIs) in 2014.

The funding facility is complemented by Technical Assistance (TA). The TA enables PFIs to better serve clients such as female entrepreneurs, MSMEs located outside Amman, start-ups; industries or projects such as energy-efficiency or small-scale green energy; or business models such as supply chain finance.

The capacity and institution building TA being provided by the Frankfurt School expert team helped participating PFIs establish dedicated MSME lending departments, adequate risk management procedures, as well as improve product development for targeted segments or industries and introduce MSME lending techniques, which enabled PFIs to provide loans to MSMEs across the country on a sustainable basis.

Frankfurt School has been working with dedicated expert teams at PFIs to improve product development, lending policies and procedures, risk management procedures and MIS/IT infrastructure. The experts have also trained and coached over 1,500 staff and management across a broad range of technical and non-technical skills to build internal capacity for the PFIs to become self-sufficient in lending to the MSME segment. To this end, training-of-trainers courses were also included. To date, five PFIs have participated in the framework and two institutions have already completed the TA phase.