International Finance Corporation
IFC - a member of the World Bank Group - is the largest global development institution focused on the private sector in emerging markets. IFC works in more than 100 countries, using their capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2020, IFC invested $22 billion in private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity.
IFC’s offerings are designed to meet the specific needs of clients in different industries, with a special focus on agribusiness and forestry, infrastructure, manufacturing, services, and financial markets. It helps countries develop their private sectors through: (i) providing direct finance to companies, (ii) mobilizing capital from other lenders and investors, and (iii) advising businesses and governments to encourage private investment and improve the investment climate. IFC is also able to support early-stage project development to seed investment opportunities, in some cases working to create markets where none existed, especially in low-income countries and those affected by fragility and conflict.
In the forestry sector, IFC provides financing throughout the entire forest value chain, from investing upstream in sustainably managed natural forests and plantations, to supporting downstream processing operations in the pulp, paper, processed wood, and biomaterials sectors, with a focus on sustainability, climate change mitigation, and energy and resource efficiency. IFC also promotes the use of green loans and forest bonds, offering economic incentives to reduce deforestation and invest in low-carbon growth.
Financing Instrument: Loans, Equity, Quasi-equity, Blended Finance, Guarantees, Grants, Trade Finance, Risk Management Products, Subnational Finance, Early-stage Development Capital.
- Loans: IFC loan tenors typically range between 7 - 12 years.
- Equity: IFC generally invests between 5 percent and 20 percent of a company’s equity. It also can invest in quasi-equity instruments such as income-participating loans, convertible loans, and preferred shares.
- Size: IFC investment size typically ranges between US$1 million – US$100 million, commensurate with project size and needs, and usually represents no more than 25%-35% of total project cost; some exceptions apply.
Recipient countries regions/country groups: Global (emerging markets and developing countries).
Recipient categories: Businesses
Eligibility Criteria: To be eligible for IFC funding, a project must meet a number of criteria, including:
- be located in a developing country that is a member of IFC;
- be in the private sector;
- be technically sound;
- have good prospects of being commercially and sustainably viable;
- benefit the local economy; and
- be environmentally and socially sound, satisfying IFC’s environmental and social standards as well as those of the host country.
IFC does not lend directly to MSMEs, but many of its investment clients are financial intermediaries that on-lend to smaller businesses.
Application guidelines: There is no standard application form for IFC financing. A company or entrepreneur, foreign or domestic, seeking to establish a new venture or expand existing operations can approach IFC directly. The "how to apply for financing" page on the IFC website offers guidance for preparing and submitting an investment proposal.