I&M Bank Tanzania has signed a $10 million facility agreement with FMO, the Dutch Entrepreneurial Development Bank, to enhance its operations and strengthen financial support for corporate customers in Tanzania. The sign-off was led by Zahid Mustafa, the CEO & MD of I&M Bank (T) Limited, and Matthijs Egelie, Senior Investment Officer at FMO – the Dutch Entrepreneurial Development Bank.
The agreement is part of a broader effort by FMO to support sustainable economic development in emerging markets. Through this facility, I&M Bank Tanzania aims to expand its lending capacity, particularly targeting small and medium-sized enterprises (SMEs) and mid-corporate clients. These businesses play a crucial role in Tanzania’s economy, contributing to job creation and GDP growth.
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I&M Bank Tanzania, a subsidiary of the Kenya-based I&M Bank Group, has positioned itself as a leading Tier 2 commercial bank since its inception in 2010. The bank provides a range of financial services tailored to corporates, SMEs, and individual clients, with a focus on accessible and innovative banking solutions.
Key Objectives and Impact
The $10 million long-term loan will provide I&M Bank Tanzania with additional funding to support businesses in key sectors of the economy. The facility is expected to have several significant impacts:
- Stimulating Economic Growth: By increasing access to credit, businesses will have greater financial flexibility for expansion and innovation.
- Job Creation: SMEs and corporates, as key employment drivers, will benefit from enhanced liquidity, leading to potential job growth.
- Enhancing Financial Inclusion: The funds will help bridge financing gaps for underserved businesses, aligning with FMO’s mission to reduce economic inequality and promote sustainable development.
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This investment also aligns with Tanzania’s national development priorities, which emphasize private sector-led growth as a critical driver of economic progress.
Environmental and Social Considerations
As part of FMO’s Sustainability Policy, the facility falls under environmental and social (E&S) risk Category FI-B, a medium risk level. I&M Bank Tanzania is required to adhere to the EDFI Exclusion List and comply with national E&S laws and regulations. Additionally, I&M Bank Group has an established Environmental and Social Management System (ESMS), ensuring effective management of E&S risks and responsible client engagement.
Expanding the FMO and I&M Bank Partnership
This latest facility builds upon an ongoing collaboration between FMO and I&M Bank Group. Previously, FMO provided a $25 million facility to I&M Bank Kenya and has engaged in other financial arrangements across the group’s operations in Kenya, Rwanda, Mauritius, Uganda, and Tanzania.
FMO, established in 1970 and headquartered in The Hague, Netherlands, is a leading impact investor with a portfolio exceeding €10.4 billion across more than 80 countries. With a focus on sectors such as financial institutions, energy, and agribusiness, FMO partners with banks like I&M to enhance financial accessibility and sustainable development in emerging markets.