IFC proposes $25m senior loan to Cambodian microfinance firm HKL

IFC/World Bank HQ. Photo: IFC

International Finance Corporation (IFC), a member of the World Bank Group, has proposed to invest up to $25 million in Hattha Kaksekar Limited (HKL), a microfinance institution in Cambodia, in the form of a senior loan.

The proposed loan aims to support HKL’s working capital and trade-related lending program to MSMEs in Cambodia as a result of the COVID-19 pandemic. About 30 per cent of the loan is targeted at women and women-owned businesses, IFC said in a disclosure.

HKL, established in 1994, is 100-per cent owned by Bank Ayudhya, the fifth-largest commercial bank in Thailand. The Thai bank is 76.88-per cent owned is a subsidiary of Japanese banking conglomerate Mitsubishi UFJ Financial Group.

In 2001, HKL received a license to operate as a limited company to provide credit and saving services and it turned into a microfinance deposit-taking institution in 2010.

Currently, the Phnom Penh-based company is providing diversified financial services to micro and small businesses and consumers. As of April 30, 2020, the MFI operates with an asset base of around $1.25 billion, serving close to 152,200 borrowers, according to IFC.

“The project (loan) intends to provide up to $25 million of liquidity to HKL, which will then be on lend to approximately 3,000 MSME clients,” IFC said, adding that the access to finance will help MSMEs sustain operations and expedite post-crisis recovery.

Cambodia has more than 450,000 micro-entrepreneurs and about 27,500 SMEs, generating about 1.6 million jobs, IFC said. Since 2015, IFC has invested nearly $80 million in HKL.

“Our involvement has allowed HKL to broaden its reach and serve a greater proportion of these entrepreneurs through a robust and well-established rural network,” it added.

In March, HKL also received an $18 million senior loan commitment from German development finance institution Deutsche Investitions- und Entwicklungsgesellschaft (DEG).

According to the German lender, the loan will help HKL fund MSMEs in Cambodia where the financial sector is still underdeveloped, particularly in rural areas access to finance is insufficient.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.