The European Bank for Reconstruction and Development (EBRD), a UK-based multilateral institution, recently agreed to provide loan funds of up to TJS 15.7 million (USD 2 million) to Arvand, a Tajikistan-based microfinance institution (MFI), for on-lending to local micro- and small enterprises (MSEs). In addition to the loan, Arvand receives funds for financing of smallholder farms.
Shoira Sadykova, General Director of Arvand, added: “A loan from the EBRD in a difficult time for the sector and the country in general confirms its commitment for development of micro and small businesses in Tajikistan. […] Businesses in Tajikistan need local currency funding to continue their activities and we are ready to provide it.”
Richard Jones, Head of the EBRD’s Dushanbe Resident Office, said: “We hope that the EBRD loan to Arvand will encourage other international lenders to provide longer-term funding in local currency to viable financial institutions in Tajikistan to support further growth of the Tajik private sector.”
As of December 2015, Arvand reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 48 million, a gross loan portfolio of USD 31 million, deposits of USD 4.8 million, approximately 22,310 depositors and 36,870 active borrowers. EBRD invested EUR 8.9 billion (USD 10.1 billion) in 377 projects in 34 countries during 2014, and as of December of that year it reported total members’ equity of EUR 14.2 billion (USD 16.1 billion).
By Kevin van den Brink, Research Associate
About Arvand
Microcredit Deposit-Taking Organization (MDO) that was established in Tajikistan in 2002 by the Agricultural Cooperative Development International/Volunteers in Overseas Cooperative Assistance (ACDI/VOCA), a US-based nonprofit that promotes economic opportunity through cooperatives, enterprises and communities. Arvand was set up to provide microcredit to low-income individuals in Tajikistan. As of 2016, it also Arvand provides deposit and microleasing services. As of December 2015, Arvand reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 48 million, a gross loan portfolio of USD 31 million, deposits of USD 4.8 million, approximately 22,310 depositors and 36,870 active borrowers.
About European Bank for Reconstruction and Development (EBRD)
The European Bank for Reconstruction and Development (EBRD) is a multilateral institution headquartered in London, England. The bank began operations in 1991 upon the agreement of 40 countries, and is owned by 64 countries as well as the European Investment Bank and the European Union as of 2014. It aims to finance operations that are both commercially viable and assist development in Eastern Europe, Central Asia and North Africa. It does this by providing loans, debt securities, equity investments, guarantees and technical assistance to micro- and small businesses via commercial banks and non-bank microfinance institutions (MFIs). EBRD invested EUR 8.9 billion (USD 10.1 billion) in 377 projects in 34 countries during 2014, and as of December of that year it reported total members’ equity of EUR 14.2 billion (USD 16.1 billion).
Sources and Additional Resources
[1] EBRD, News, “EBRD Loan to Support Private Sector In Tajikistan”
MicroCapital Universe Profile: Arvand
MicroCapital Universe Profile: European Bank for Reconstruction and Development (ERBD)
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