IFC Partners with KB Kookmin Card Co. to Boost Access to Finance for Small Businesses in Indonesia and Foster Digital Inclusion in Thailand

​Jakarta, April 29, 2024-To increase access to finance for small businesses in Indonesia and boost digital inclusion in Thailand, IFC today announced an initiative with KB Kookmin Card Co. (KBC), a leading credit card-issuing company in the Republic of Korea, to support the company's small and medium enterprise (SME) and mobile financing growth in the two countries.

As part of the financing package, IFC is providing a $100 million loan in Indonesian rupiah equivalent to PT KB Finansia Multi Finance (KB FMF), an Indonesian multi-finance company which KBC has a majority stake in, and a $50 million loan in Thai baht equivalent to KB J Capital Co. Ltd (KBJ), a Thai non-bank finance company of which KBC is also the majority owner.

In Indonesia, IFC's funding will support micro, small, and medium enterprises (MSMEs) with a primary focus on supply chain finance loans. In Thailand, IFC's loan will allow KBJ to provide installment financing for mobile phones, with a primary focus on the nation's less developed regions. KBJ has been an exclusive financing service provider for Samsung mobile devices in the country since 2022.

"IFC's investment will allow both KB FMF and KBJ to support the underserved segments in Indonesia and Thailand, respectively," said Mr. Moon Cheol KANG, Managing Director of KB Kookmin Card. "As a multi-finance company, KB FMF is well positioned to develop their supply chain finance programs, especially for smaller businesses, where financing gaps are the widest. In Thailand, IFC's funding will send a positive signal, attracting funding and allowing KBJ to expand financing for mobile phones in the country's underdeveloped regions."

MSMEs play a central role in the Indonesian economy, employing 97 percent of the total workforce and contributing 61 percent of GDP but are constrained by limited access to finance. Meanwhile, the supply chain finance market holds significant potential to support MSMEs in Indonesia by providing a key tool to reach them across supply chains and give more flexibility on working capital management.

In Thailand, internet-enabled mobile devices remain the primary source of internet access in the less developed regions of the country. However, 76 percent of people in the north of the country compared with 96 percent in Bangkok have a smartphone device. Access is hindered by the high upfront cost of smartphones, which in turn limits individuals' capacity to participate in a growing digital ecosystem.

"Financial and digital inclusion underpin resilient and inclusive growth. IFC is working with KB FMF and KBJ to enable more small businesses and consumers to access the funding and digital tools they need to grow and thrive," said Kim-See Lim, IFC's Regional Director for East Asia and the Pacific.

In addition to the financing, IFC will support FMF and KBJ in strengthening their responsible finance frameworks, including aligning their current operations with international best practices and national customer protection regulations.

IFC's investment announced today builds on the existing partnership with KBC to support MSMEs. In December 2020, IFC provided funds to KB FMF to continue lending to MSMEs during COVID-19 pandemic.

About IFC
IFC - a member of the World Bank Group - is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2023, IFC committed a record $43.7 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visit www.ifc.org

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