33794 - Bayport Zambia

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Summary of Investment Information

Project Number

33794

Company Name

BAYPORT FINANCIAL SERVICES ZAMBIA LIMITED

Date SPI Disclosed

Dec 16, 2013

Country

Zambia

Region

Africa

Projected Board Date

Jan 16, 2014

Environmental Category

FI-3 - No Impact

Status

Completed

Last Updated Date

Jun 12, 2021

Department

Regional Industry - FIG ME & Africa

Industry

Financial Markets

Previous Events

Approved : Feb 5, 2014
Signed : Apr 11, 2014
Invested : May 16, 2014

Sector

Other Non-Banking Financial Institution (NBFI)

Project Description

Bayport Financial Services Limited, Zambia (“Bayport” or “the Company”) is a payroll based lender operating in Zambia. The Company has been operating since 2002 and provides personal unsecured credit to formally employed low and middle income earners, predominantly civil servants and employees of large corporations. The loans extended by Bayport are mostly used for housing/home improvement, education, and small business start-ups. Bayport also offers domestic money transfer services. In the project under consideration, IFC will support Bayport to expand its lending operations to the low and middle income population by anchoring its inaugural domestic bond.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	10.76
Equity

Development Impact

- Financial inclusion: increased access to financial services for the low and middle income population in Zambia, including those living in rural areas. Such financial inclusion is expected to be the source of other benefits namely: home improvement, education, small business start-ups/job creation.

Other related development impacts expected from the project include: i) contributing to building a domestic capital market, which is a critical ingredient to the financing of the domestic economy; ii) contributing to strengthening the regulated micro-lending space in Zambia as IFC provides needed capital and reinforces the capacity of the sector leader.

- Catalytic role: Bayport Zambia is making its first step in the domestic capital market in Zambia, and the IFC presence as an anchor investor will enhance the profile and the liquidity of the note. It is worth noting that the success of the first issuance will have great impact on the Company''s long term capital structure.
- Long term local currency funding: IFC will provide long term local currency funding barely available in the domestic market at present.

E&S Category Rationale / Risks and Mitigation

The project has been categorized as FI-3 according to IFC’s Environmental and Social Review Procedures. Bayport Zambia provides payroll based loans; the portfolio risk is considered low and the potential E&S risks are considered minimal. Bayport Zambia will not be required to conduct any E&S assessments before providing loans. However, as the Company may expand its product offerings, it will be required to notify IFC of any change in business operations and implement an E&S management system consistent with the risks and impacts of these lending activities as needed.

Contacts

For Inquiries About the Project, Contact

Mr. Justin Chola
Bayport House
68 Independence Avenue
Lusaka, Zambia
Tel: +260 977 740 938
Fax: +260 211 252 386
Email: mailto:jchola@bayportfinance.com

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This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

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