36941 - KRK Kosovo

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Summary of Investment Information

Project Number

36941

Company Name

KREDITIMI RURAL I KOSOVES LLC

Date SPI Disclosed

Jun 22, 2015

Country

Kosovo

Region

Europe

Projected Board Date

Jul 24, 2015

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Jun 12, 2021

Department

Global Industry, Financial Markets

Industry

Financial Markets

Previous Events

Approved : Aug 7, 2015
Signed : Aug 21, 2015
Invested : Sep 4, 2015

Sector

Microfinance and Small Business - Non Commercial Banking

Project Description

The proposed project consists of a long term senior loan of up to EUR1.5 million to Kreditimi Rural i Kosoves (“KRK” or the “Company) for on-lending to individual, micro and small enterprises (MSEs) in Kosovo.

KRK, a greenfield company to IFC, is a leading lender to micro and small entrepreneurs in Kosovo’s rural and semi urban areas. The project seeks to partner with KRK as a platform to provide access to finance to the entrepreneurial poor that are typically underserved by traditional commercial banks.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	1.65
Equity

Development Impact

IFC impact is expected to:
i. Stimulate development and economic growth in the country by enhancing the MFI's ability to support access to finance for micro, small and medium enterprises as the major contributor to country's economy;
ii. Create job opportunities for entrepreneurs and individuals especially in rural areas with direct impact in poverty reduction;
iii. Stimulate demonstration effects for other MFIs in the country to introduce best standards in insurance, environment and social systems.

IFC's role in the project is multifold:
i. It will support one of the important MFI players in the Kosovo market to diversify its term funding sources, otherwise scarce in the local market;
ii. Support the MFI in its growth plan to finance micro and small entrepreneurs in rural areas with a particular focus in agriculture;
iii. Strengthen KRK's positon for future growth by transferring IFC's experience in microfinance;
iv. Continue to improve KRK's operational procedures and practices by requiring to implement best practices in environmental and social management systems.

Indicator	Metrics	Comments	Calendar Year 2022	Calendar Year 2023	Calendar Year 2024
Access to Finance: Outstanding Microfinance Portfolio (#)	Outstanding Portfolio (#)		Not Available	Not Available	Not Available
Access to Finance: Outstanding Microfinance Portfolio ($)	Outstanding Portfolio ($)		Not Available	Not Available	Not Available

E&S Category Rationale / Risks and Mitigation

The proposed project consists of a senior loan of up to EUR1.5 million to Kreditimi Rural i Kosoves (KRK) for on-lending to individual, micro and small enterprises (MSEs) in Kosovo. The majority of KRK’s portfolio consists of loans granted to individuals to finance their small businesses such as farming or animal husbandry The highest exposure is to agriculture and services which entail business activities that have potential limited adverse environmental or social risks or impacts that are few in number, generally site specific, largely reversible, and readily addressed through mitigation measures. The project has therefore been classified as FI-2 according to IFC Environmental and Social Review Procedure. For this particular project, IFC's applicable requirements will be to ensure that all projects in KRK's portfolio are screened against the IFC Exclusion List and the applicable environmental and social host country laws and regulations. In addition KRK will comply with the requirements of IFC’s PS2 on Labor and Working conditions.

Contacts

For Inquiries About the Project, Contact

Lulzim Sadrija
CEO / Kreditimi Rural i Kosoves
Rr. Rexhep Mala No. 4
Pristina, Kosovo
Tel +381 38 222 345

For Inquiries and Comments About IFC, Contact

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Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
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Local Access of Project Documentation

Kreditimi Rural i Kosoves
Rr. Rexhep Mala No. 4
Pristina, Kosovo

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

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Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

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.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

Task Title & Description	Anticipated Completion Date
Develop guidelines	08/30/2015
Staff Training	08/30/2015
Enhance HR practices in line with IFC Performance Standard 2: Labor and Working Conditions	02/26/2016

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