Alliance Finance Company PLC secures USD 10 mn Netherlands’ FMO in long term financing

Sri Lanka’s oldest finance company, Alliance Finance Company PLC (AFC), has received the second tranche of USD 5 Mn from the Dutch Entrepreneurial Development Bank (FMO) as part of a long-term financing facility of USD 10M to expand its growing portfolio of MSME business.

AFC secured this USD 10 Million facility from the Dutch entrepreneurial development bank FMO in mid-2021 and received the first tranche of USD 5 Mn in 01.07.2021 With an investment portfolio of EUR 6.3 billion, FMO is one of the largest European bilateral private sector development banks with investments in 85 countries. This financing series is also a significant development for the country’s MSME sector, which is considered as the backbone of the economy.

Romani de Silva, Deputy Chairman & Managing Director of AFC stated: “This is an important milestone for AFC’s MSME focused business strategy and we are encouraged and excited by FMO’s partnership in our MSME plans. AFC-FMO partnership to develop the MSME sector in the country confirms AFC’s growing international credibility. Last year AFC became the first certified financial institution in South Asia for holistic sustainability in the Banking and Finance sector, governed under the EOSD International Council of Sustainability Standards for Value-Driven Financial Institutions (ICSSVDFI). FMO is no stranger to AFC since it assisted AFC with a similar facility in 2018. The facility is for 5 years with a fixed interest rate, thereby helping AFC to manage its asset and liability mismatch in the balance sheet. AFC readily receiving such global high tier financing is proof of international accreditation of our proven focus on sustainable financing which in turn is part of our larger commitment to the triple bottom line of People, Planet and Profit.”

In 2017, AFC became the first financial institution in Sri Lanka’s NBFI sector to commit to the UN’s Sustainable Development Goals (SDG) and Paris Agreement on Climate Change when it signed the ‘Karlsruhe resolution’. In recent years, AFC has been investing 3%-4% of its profits annually on social and environmental sustainability initiatives despite the extremely challenging external environment. In its initiatives beneficial to the environment and society, AFC has pledged LKR 18 Mn for sustainability initiatives during 2020/21 financial year.