📋 Tender Overview
Location:
Mongolia
Project number:
56038
Business sector:
Financial institutions
Notice type:
Private
Environmental category:
FI
Approval date:
28 Jan 2025
Status:
Approved
English-language PSD published:
04 Feb 2025
Project Description
The provision of second senior unsecured loan of up to US$ 1.5 million (in MNT equivalent) to be provided under the FIF Youth in Business Programme in Central Asia (YiB CA) in favour of Transcapital NBFI LLC (TCMN or the Company).
Project Objectives
The proceeds of the Bank's loan will be used for on-lending to eligible micro, small and medium-sized enterprises led by young people under the age of 35 (Youth MSMEs) in line with the eligibility criteria set forth in the YiB CA Policy Statement. In addition, TCMN will track all beneficiaries under the YiB CA by gender and has committed to ensuring that at least 30 per cent of all sub-borrowers will be women.
Transition Impact
ETI score: 71
The project will be the second sub-operation under the YiB CA in Mongolia and will support Inclusive and Competitive qualities of the programme. The project is expected to increase lending to young people in Mongolia, facilitate TCMN's capacity building and promote the transfer of skills to young business owners/managers in the country.
Client Information
TRANSCAPITAL NBFI LLC
Established in 2001, Transcapital NBFI LLC (or TCMN) is the 3rd largest non-bank financial institutions (NBFI) in Mongolia and has been a client of the EBRD since 2013. The Company is headquartered in Ulaanbaatar ("UB"), has a network of 38 branches, of which 19 are in rural areas, and employs circa 204 people.
EBRD Finance Summary
USD 1,500,000.00
The EBRD finance US$ 1.5 mln.
Total Project Cost
USD 1,500,000.00
Additionality
Innovative financing structures and/or instruments: The project will benefit from a First Loss Risk Cover (FLRC) and a Performance Based Compensation (PBC), which is a tailor-made and innovative instrument in the Central Asian market.
Financing structure: the EBRD provides local currency financing on terms, which are not readily available in the market.
Standard setting: through a combination of elements (financing; FLRC; PBC; TC), the YiB CA will help TCMN raise its inclusive financing standards by generating a better awareness and understanding of the needs of the underserved segment of young entrepreneurs. Ongoing support and collaboration with the YiB TC consultant, vital for introducing innovative products, will enable the PFI to further refine and advance its offerings and delivery mechanisms, ensuring they better meet the needs of young entrepreneurs.
Gender SMART: The persistent gender gaps in youth entrepreneurship in Mongolia will be addressed through dedicated TC to TCMN that will help develop a gender-responsive approach to youth focused lending, thereby ensuring that youth outreach is designed for both young women and men.
Knowledge, innovation, a
