US$ 1 million worth of micro loans in local currency to be channelled to households by First MicroCredit Company
The EBRD is committing new local currency loans worth US$ 1 million in the Kyrgyz Republic to support improvements in energy and water efficiency in the south of the country.
The funds will be extended as loans to households for energy and water efficiency improvements.
The microfinance institution, First MicroCredit Company (FMCC), will on-lend the loans which will finance investments for improvements such as the purchase and installation of energy-efficient windows and doors, thermal insulation of walls and roofs, installation of heat pumps and other measures which make homes more comfortable – as well as helping reduce energy and water costs.
The loan agreement was signed by EBRD First Vice President Phil Bennett during his visit to Bishkek today.
He said: “Under our Green Economy Transition approach, the EBRD is keen to act as a catalyst in attracting partner financial institutions, including banks and microfinance companies, to sustainable energy and resource investments. We are therefore very pleased to be working with FMCC in the Kyrgyz Republic to provide much needed financing for sustainable energy at the micro financing level and also to be able to do so in the local currency, the som.”
Stefan Martiniak, CEO of FMCC, added: “Today, we are making yet another step in a long-term cooperation between the EBRD and FMCC. This attractive facility will allow the clients of FMCC to invest into a sustainable ecological future for their businesses and homes.”
FMCC is active mostly in the southern areas of the Kyrgyz Republic. Its main shareholder is the Aga Khan Agency for Microfinance (AKAM), which supports development projects, including microfinance in Central Asia.
The new loan is extended under the EBRD Kyrgyz Sustainable Energy Financing Facility (KyrSEFF) supported by funding from the European Union's Investment Facility for Central Asia. So far a total of US$ 25 million has already been committed to energy efficiency projects under the programme in the country.
The EBRD’s Sustainable Energy Financing Facilities are designed to channel funds provided by the Bank, international donors and participating financial institutions to businesses and households. Such frameworks exist now in 25 countries, including the Kyrgyz Republic.
Addressing global challenges such as climate change and resource efficiency is one of the EBRD’s main priorities. The Bank has a number of other programmes in the Kyrgyz Republic which address those challenges such as a framework to modernise the country’s water and wastewater networks.
To date, the EBRD has invested over US$ 700 million into various sectors of the Kyrgyz economy.