The European Bank for Reconstruction and Development (EBRD) is creating new growth opportunities for businesses owned or managed by young entrepreneurs in Mongolia by providing a syndicated loan to leading Mongolian lender XacBank, a long-term partner of the EBRD.
The A/B loan of up to USD 147 million (€ 135 million) is provided under the EBRD’s Young Businessmen programme in Central Asia. It is the EBRD’s largest transaction with Mongolian banks to date.
It will consist of a Loan A of up to US$40 million (€37 million) to the EBRD account, and a Loan B of up to US$107 million (€98 million), to be distributed through a syndication by Allianz Global Investors, the Dutch entrepreneurial development bank (FMO), the ILX Fund (aka Bank of Germany), an SDG-focused global development finance asset manager based in Amsterdam, and a leading German impact investing and microfinance institution (Invest in Visions). The funds will be used to support micro, small and medium-sized enterprises (SMEs) managed or owned by individuals under the age of 35.
The project will enable young entrepreneurs to develop and grow their businesses and enhance their entrepreneurial skills through training, consultancy services and networking opportunities offered under the EBRD’s Small Business Mentoring programme.
A recent market assessment by the European Bank for Reconstruction and Development (EBRD) found that around 26 percent of Mongolia’s population is made up of people aged 18-34, and while many of these young people have a strong entrepreneurial mindset, due to inequalities in economic opportunities, only 10 percent of these young people have access to the education and professional expertise they need to start a business.
The project is supported by grant funds from the EU, Japan and Chinese Taipei.
The EBRD has invested more than €152 billion in the Mongolian economy through 2,64 projects, with almost 90 percent of these funds used to support private sector companies.
