Micro-finance institution will on-lend to rural customers
The European Bank for Reconstruction and Development (EBRD) is extending a second energy efficiency loan through its Energocredit facility to SEF International, a VisionFund microfinance institution in Armenia.
SEF International will receive a local currency loan worth US$ 1 million for on-lending to rural customers for energy efficiency investments.
The sub-loans, which are expected to become available from August 2016 onwards, will primarily support investments in energy and cost-efficient heating, cooling, ventilation systems and small business equipment.
As SEF International mainly targets small borrowers, loans are expected to be in the range of US$ 300 to US$ 600, with a 10 per cent grant element for eligible projects provided by the EBRD Shareholder Special Fund.
The EBRD extended the first US$ 1 million facility to SEF International in 2014. The funds were allocated to more than 1,600 customers, mostly from rural regions of Armenia, with an average loan size of US$ 500 equivalent.
Garegin Gevorgyan, CEO of SEF International, said: "We are excited to continue the collaboration with the EBRD, which will help us reach out to people with limited access to such facilities, expanding the range of the products we offer and adding an environmental dimension to our model of social mission and commercial sustainability."
The EBRD is a leading institutional investor in Armenia, having invested over €1 billion in 150 projects in the country’s financial, infrastructure, energy and corporate sectors, with 88 per cent of these projects being in the private sector.