The FINANCIAL — The EBRD is continuing to support micro and small businesses in Mongolia with a loan to microfinance institution, Transcapital. The loan of MNT 6 billion will be provided in the local currency, Mongolian tugrik.
Transcapital, the most reputable microfinance institution in the country, has been an EBRD client since 2013. The loan, which comes under the EBRD Early Transition Countries Initiative,* is the second loan to Transcapital enabling the client to increase its customer base and reach additional under-served customers such as micro enterprises in the poorer areas of Ulaanbaatar or in the regions.
Transcapital’s network will allow EBRD financing to reach micro enterprises around the country – some of which, we hope, will grow into small and medium-sized companies. Importantly, the loan will be denominated in local currency, allowing entrepreneurs who sell their goods and services in local currency to avoid foreign exchange rate risk, according to EBRD.
Transcapital CEO, Altanzul Zorigt, said: “Since 2013, our two organisations have been successfully cooperating to provide opportunities to micro and small enterprises in underdeveloped regions and improve access to finance in Mongolia. With the EBRD’s local currency loan, our clients have been able to access funding with no effect from foreign exchange rate risk, further strengthening Transcapital’s presence on the market. On the other hand, Transcapital has enjoyed tangible developments within the organisation through the EBRD’s technical assistance and expertise sharing. We are glad to see that our goal to promote sustainable development of micro and small enterprises is only growing stronger with this funding. I’m looking forward to extending our services to more rural and economically disadvantaged populations.”
The EBRD has invested about US$ 1.6 billion in about 86 projects in Mongolia since 2006.