IFC Invests in Asialink to Boost Small-Business Lending in the Philippines

Manila, Philippines, January 21, 2025—In line with its goal to ramp up financial inclusion in the Philippines, the International Finance Corporation (IFC), the largest global development institution focused on the private sector in emerging markets and a member of the World Bank Group, announced today it will provide up to $130 million in investment to Asialink Finance Corporation (AFC).

IFC’s investment will help AFC in expanding its financing for MSMEs, with at least 60% of loan proceeds earmarked for women-owned or led MSMEs (WMSMEs). Aside from financing, IFC will also help the company implement an Environmental and Social Management System framework and responsible finance principles in line with international best practices.

"We hope to demonstrate the viability of lending to this sector and encourage other players to develop solutions that cater to MSMEs," said Jane Yuan Xu, Acting Country Manager for IFC Philippines. "Because ultimately, we are not just funding companies, we are creating jobs at the grassroots level. Every loan to an MSME can mean five, ten or twenty new jobs in local communities. And that’s what drives an economy forward.”

Financial inclusion is at the core of AFC’s strategy as it is able to service underserved or unbanked MSMEs and individuals, most of whom don’t have the necessary collateral to access bank financing.

"We are very grateful for IFC's support, which will allow us to expand our lending to more MSMEs, particularly in underserved regions of the country and those that have historically been excluded from the formal financial sector," said Robert B. Jordan Jr., CEO of Asialink Finance Corporation Group of Companies. "MSMEs are the backbone of the Philippine economy, but in many parts of the country it’s still a huge struggle to access the financing they need to grow and thrive. With this investment, we will help change that.”

Although 75 percent of MSMEs are located outside Manila, Bangko Sentral ng Pilipinas (BSP) figures show that just 14 percent of the banking system’s loans serve companies outside the capital. A 2021 BSP Financial Inclusion Survey also shows that the depth of financial penetration in the country is very limited, especially for women. Only 20 percent of women own formal bank accounts compared with 26 percent of men.

In 2024, IFC invested in two fintech startups, Salmon and First Circle, both of which cater to consumers and MSMEs unable to access the formal credit market. In July 2024, IFC invested $100 million in a social bond issued by City Savings Bank, with the proceeds being used for loans to women in low and lower middle-income groups, encouraging them to make investments in small businesses to supplement their family's income in addition to payments for healthcare, education and housing.