Citi, OPIC, Bank Danamon Back Indonesia?s Microfinance with USD20 Million Loan
Wednesday, August 3, 2011
Citi Indonesia, the Overseas Private Investment Corporation (OPIC) and Bank Danamon will extend a USD20 million term loan to fund the growth of Bank Danamon’s microfinance programme, Danamon Simpan Pinjam (DSP), and to promote the financial inclusion of microentrepreneurs and small businesses in Indonesia. This loan will be the first from Citi and OPIC for the microfinance sector in Indonesia, and is part of Citi’s and OPIC’s USD250 million joint global initiative to support microfinance lending in emerging markets worldwide.
“Microfinance has tremendous potential not only to help tackle unemployment and promote financial access in Indonesia, but also as one of the engines of the country’s economic growth,” says Kunardy Lie, head of global banking Citi Indonesia. “This loan shows the continuation of our commitment to Indonesia’s economy. Through Danamon Simpan Pinjam, which focusses on small traders, micro-entrepreneurs and the value chain for entire businesses [that has a wise and prudent regulatory structure], we are confident that it will come to a progressive programme that enables small businesses in Indonesia to grow further,” he adds.
“Indonesia has been a leading centre for microfinance for decades, and the scale and diversity of its contribution to financial inclusion is evidenced by the expansion of Danamon Simpan Pinjam’s programme supported by this facility,” comments Bob Annibale, Citi’s global director of microfinance.
“Indonesia is a priority country for OPIC and a nation poised for significant economic growth in the coming years. Enabling microentrepreneurs to play an important part in that growth will ensure that Indonesia has a strong foundation for its economy,” says OPIC president and CEO Elizabeth Littlefield.
“This loan will strengthen our commitment in accelerating expansion in micro financing through Danamon Simpan Pinjam business, and to pursue our vision to ’enable millions to prosper’. This year, we will open around 157 new DSP outlets across Indonesia to establish total of more than 1,200 DSP outlets, to better serve our customers and further provide financial access to the society, particularly our potential customers who live surrounding the traditional markets,” notes Minhari Handikusuma, Danamon’s director for micro business.