Euro bank, Turkish fund agree to expand financing for women-led firms
The European Bank for Reconstruction and Development (EBRD) and Turkey’s Credit Guarantee Fund (KGF) have said they are joining forces to expand financing for small and medium-sized businesses led by women.
The agreement was signed by the Fund’s Deputy General Manager Caner Teberoğlu and EBRD Managing Director for Turkey Arvid Tuerkner, on the sidelines of the EBRD’s Annual Meeting and Business Forum in Jordan.
According to statement released on May 10, the partnership will enable the EBRD to unlock 300 million euros in new financing to support women’s entrepreneurship in a country where only 34 percent of women participate in the workforce.
Women running their own businesses find it particularly hard to access affordable financing and generally tend to borrow from friends and family rather than from a formal financial institution, read the statement.
Over the past three years, an initiative developed by the EBRD with the European Union and the Turkish government has helped 17,000 women in 79 out of 81 Turkish provinces to grow their businesses through a combination of finance, advisory services and coaching, added the statement.
Under the program, the EBRD provided 300 million euros to five key Turkish lenders: Garanti Bank, QNB Finansbank, TEB, Isbank and Vakıfbank.
Through their branch networks, loans averaging 15,000 euros were extended to firms led by women. Two-thirds of this financing has been channeled to companies outside the large metropolitan areas of Istanbul, İzmir and Ankara, according to the statement.
Marking a new phase of the program, KGF will provide risk mitigation to the EBRD’s partner banks through the absorption of a portion of potential losses on their loans made under the program.
“I am sure that everyone knows the success of the EBRD’s Women in Business Program, which Turkey also supported as a donor. It is not easy to find a multilateral development bank such as the EBRD, which is directly touching the daily lives of women, youth and small businesses. Having contributed to the past year’s strong economic growth of Turkey, now KGF is taking the initiative to support women entrepreneurs,” said Raci Kaya, deputy undersecretary of Turkey’s Treasury.
“At the EBRD we spare no effort to ensure that our investments create opportunities for those who cannot easily access financing, including women entrepreneurs. We have helped 17,000 women to grow their businesses and this is only a beginning. We are honored to join forces with the KGF to unlock further financing for women-led firms and are already working with Garanti Bank on new financing. We encourage other development partners and commercial lenders to join this worthwhile effort,” said Tuerkner.