IFC & GAFSP Invest in Kosovo Microfinance to Empower Women-Owned Businesses & Boost Agribusinesses

The International Finance Corporation (IFC) and the Global Agriculture and Food Security Programme (GAFSP) have teamed to enhance financial access for microenterprises, agribusinesses, and smallholder farmers in rural and semi-urban areas of Kosovo. This coordinated initiative aims to close the funding deficit, encourage employment growth, raise living standards, and increase food security throughout the nation.

To achieve these objectives, IFC and GAFSP are making strategic investments in three of Kosovo's leading microfinance institutions (MFIs). The financing package includes three senior loans, with IFC and GAFSP each contributing up to €9 million to KEP Trust (KEP), up to €8 million to Kreditimi Rural i Kosoves (KRK), and up to €6 million to Agjensioni për Financim në Kosovë (AFK).

Kosovo's business landscape predominantly consists of micro, small, and medium enterprises (MSMEs), accounting for 99 percent of all businesses. However, these enterprises face a substantial financing gap, particularly in the underdeveloped agriculture sector. Additionally, women-owned businesses encounter additional hurdles, including limited access to financing and a lower employment rate compared to their male counterparts.

The dispensed funds from the loans will be utilised to credit individual entrepreneurs and micro businesses in Kosovo. Notably, 50 percent of the loans will be specifically earmarked for agribusinesses, while at least 20 percent will be allocated to support women-owned enterprises.

In addition to financial support, IFC will provide advisory services to the three microfinance institutions, assisting them in optimizing and expanding their microlending portfolios. This collaboration will focus on streamlining lending processes and enhancing procedures for farmers and firms operating in the agriculture sector. By leveraging digitalization and adopting climate-smart agriculture technologies, the MFIs aim to facilitate easier access to finance for the targeted beneficiaries.

Alfonso Garcia Mora, the Vice President for Europe, Latin America, and the Caribbean at IFC, highlights the importance of improving credit access for underserved segments, including farmers, rural companies, and women-owned firms in Kosovo. He emphasizes that the microfinance sector plays a pivotal role in supporting economic growth, fostering inclusion, and unlocking entrepreneurial potential, thereby creating opportunities for all citizens in the country.

It is worth noting that the three microfinance institutions involved in this initiative have long-standing partnerships with the IFC and the Private Sector Window of GAFSP. Through their collective efforts, this collaboration aims to empower women-owned businesses, boost agribusinesses, and drive sustainable development in Kosovo.