A Myanmar Social Enterprise, Proximity Designs and Yoma Bank Signed an Innovative Funding Agreement

7.3 billion MMK Funding Agreement to Drive Financial Inclusion of Farmers and Rural Based Entrepreneurs
Sep 5, 2017

Yangon, Myanmar – Sep 5 2017. Proximity Designs and Yoma Bank signed an innovative back-to-back funding agreement for 7.3 billion MMK. Proximity Designs runs their micro-finance business unit, Proximity Finance, currently keeping a loan book of 20.5 billion MMK and 78,000 active clients. Yoma Bank is one of Myanmar’s largest banks with over 3,000 staff and 72 branches nationwide. The loan agreement allows Proximity Designs to fully hedge U.S. dollar funding attracted overseas, on the back of which a multiple of Myanmar Kyat is lent locally by Yoma Bank.

The practice of a Myanmar bank lending on a semi-secured basis to microfinance companies is unprecedented to date. The funding made available through this pioneering deal enables Proximity Designs to further grow their microfinance business and will enable twenty-eight thousands of farmers and other rural based entrepreneurs to obtain credit to manage the working capital flow of their respective businesses. "Yoma Bank is proud to support the extension of credit to Myanmar's unbanked population through this innovative partnership with Proximity Designs. The development impact of this funding reflects Yoma Bank's commitment to support an inclusive financial system and our core value as The Responsible Bank,” said the Advisor to the Chairman and CEO of Yoma Bank, Mr. Hal Bosher.

Savoeung Chann, CEO of Proximity Finance, said; “We are delighted to announce this innovative agreement with Yoma Bank to support the growth of Proximity Finance. We hope that this milestone facility will enable us to increase our reach to 28,000 new farmer households across Myanmar and deliver more affordable products for our clients. We would also like to acknowledge the invaluable support from Yoma Bank, Central Bank and FRD in making this landmark deal happen”

About Yoma Bank

Founded in 1993, Yoma Bank is Myanmar's most progressive domestic bank. Over the past few years, Yoma Bank has made significant investments in strategic priorities - people, technology and corporate governance. Yoma Bank is Myanmar's fourth largest bank by assets with 3000+ employees and 72 branches across the country. Yoma Bank was the International Finance Corporation's (IFC) first direct investment in Myanmar in 2014 and it benefitted from a comprehensive 3-year advisory package to upgrade credit risk management, finance, treasury, product development and to procure a new core banking system (Misys Fusion Banking Essence). Yoma Bank also receives ongoing technical assistance from GIZ, the German development agency, to improve and expand our SME lending. In 2015, Yoma Bank formed a strategic partnership with Telenor (Myanmar's largest foreign Telco) to develop nationwide digital financial services through the formation of Wave Money, a mobile financial services company. Yoma Bank has benefitted from a significant grant from LIFT, a multi-donor, UNDP administered trust fund, to expand agribusiness finance to Myanmar's underserved agricultural community - a key segment in Myanmar’s development. Technical assistance for this program is provided by Rabo Bank, a Dutch agricultural bank. Yoma Bank is committed to financial inclusion in Myanmar.

About Proximity Designs

The mission of Proximity Designs is to improve the livelihoods of rural families throughout Myanmar with affordable products and services -- irrigation pumps, drip systems, water storage tanks, farm finance and crop advisory services -- all designed to boost farm productivity and incomes. In 2012, Proximity Finance, as a business unit of Proximity Designs, began offering much needed affordable credit to smallholder farmers. With extensive distribution network and a long-standing connection to the rural sector, Proximity Finance has expanded the micro-lending business rapidly. From an initial financing outreach of 10,000 clients, Proximity Finance has grown to 78,000 clients as of July 2017.

You can download the press release in Myanmar versions.


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