The World Bank has approved a $300 million credit for the Mozambique Access to Finance and Economic Opportunities Project or Mais Oportunidades project. The six-year project will span from 2023 to 2029 and will be financed by the International Development Association (IDA).
The World Bank will support the Government of Mozambique to address multiple economic shocks and market constraints that prevent micro, small, and medium enterprises (MSMEs) and individuals, including informal workers, from accessing and using financial services and taking advantage of economic opportunities.”
Idah Z. Pswarayi-Riddihough, World Bank Country Director for Mozambique, Madagascar, Mauritius, Comoros, and Seychelles.
The project directly supports the Government of Mozambique’s reform initiative, Pacote de Medidas de Aceleração Económica (PAE), through the creation of a national Credit Guarantee Fund, which is the first of its kind in Mozambique. This fund will help mobilize liquidity in the banking system and unlock financing for SMEs, including women-owned firms and those operating in regions or sectors vulnerable to climatic shocks.
The innovative approach to combining private and financial sector development interventions aims to address key constraints limiting financing for MSMEs in Mozambique and mobilize private capital through the creation of a national Credit Guarantee Fund
Julián Casal, World Bank Senior Financial Sector Economist for Mozambique.
The Credit Guarantee Fund will also mitigate third-party credit risk to lenders to increase access to credit. Lines of credit will complement the credit guarantees to mobilize private capital and matched savings programs further to link informal savings with formal banks and mobile wallets.
Ultimately, the Mais Oportunidades project will deepen business environment reforms, expand market access, and provide training and financing. It is expected to help create over 26,000 new jobs over six years. Besides, the combination of credit guarantees and lines of credit aims to mobilize up to $450 million in private-sector loans to MSMEs across the country through partner financial institutions.
