International Finance Corporation (IFC), the private lending arm of the World Bank, has agreed to invest up to RMB130 million (US$20 million) in China’s listed bank Qiongzhong Rural Credit Cooperative (RCC), according to IFC's disclosure filings.
The investment consists of a senior debt for a three-year tenor, and will help Qiongzhong RCC provide loans to small businesses and farmers in China.
The money will be geared in particular for supporting the development of Hainan province, and support financial inclusion by focusing on micro-borrowers, particularly women in rural areas.
Founded in 2008 in Qiongzhong County in Hainan province, Qiongzhong RRC operates in the whole island province and provides microloans for over 200,000 farmer households covering 10 counties and 100 villages.
Currently, it manages microloan portfolio of RMB3 billion (US$420 million), and has 17 branches and over 300 agent outlets with banking terminals. In Qiongzhong Country, the bank has a 40% market share in deposit, 63% in loans, and 44% in number of outlets.
China has a high proportion of the unbanked and underserved population, particularly in rural areas. The proposed investment, supporting the rural financial system in a frontier province, is aligned with IFC's strategy in China and is consistent with the country priorities, the filing said.