50444 - DCM Alfalah DPR

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Summary of Investment Information

Project Number

50444

Company Name

Alfalah Diversified Payments Rights SPV Ltd

Date SPI Disclosed

Apr 1, 2026

Country

Pakistan

Region

Middle East

Projected Board Date

Apr 30, 2026

Environmental Category

FI-2 - Limited

Status

Pending Signing

Last Updated Date

Jun 2, 2026

Department

Regional Industry FIG MCT

Industry

Financial Markets

Previous Events

Approved : May 27, 2026

Sector

Commercial Banking - General

Project Description

The proposed project aims to provide financing of up to US$100 million, for up to 5 years, to Bank Al Falah (“BAFL” or “the Bank”), a long-standing IFC client, through the first of its kind Diversified Payments Rights (“DPR”) program established by a bank in Pakistan, with IFC as the anchor investor (“the Project”). The proceeds of IFC’s investment will enable the Bank to increase its support to Micro, Small and Medium Enterprises (MSMEs) and Agri sectors in Pakistan that will be identified as per IFC definitions.

Associated Advisory Engagement

The Project is part of an initiative to launch the DPR product in Pakistan, which included IFC’s Upstream Advisory (“UA”) work with the State Bank of Pakistan to develop the necessary regulatory and fiscal framework, to enable the creation of a new asset class. The Project was supported by additional UA focused on preparing the Bank for launching and servicing a DPR program.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	100.0
Equity

IFC's loan to the financial institution described in this SII is targeted for on-lending to the following sector(s):

Product Type	Use of Proceeds
Straight Senior Loan	Loans to MSME (mix of Micro and SME)
Syndications	Loans to MSME (mix of Micro and SME)

IFC's Definitions of Targeted Sectors can be found here.

Development Impact

The development impact of the Project will be delivered through increased access to finance for MSMEs in Pakistan, including those in the agricultural sector, via investing in the inaugural notes issued under the Bank’s DPR program. Beyond the project level outcomes, IFC anticipates that by demonstrating the viability of a DPR structure, the first one to be established by a bank in Pakistan, it will spur replication by other banks fostering resilience of Pakistan’s financial sector.

Financial Additionality: IFC will introduce a new long term FX denominated financing instrument to Pakistan by investing in up to five-year notes issued under the Bank’s DPR program. IFC will provide tenor that is currently very limited for financial institutions in the local market and materially improve the Bank’s asset liability management. As the anchor investor, IFC is expected to mobilize up to US$50 million in third party funding, supporting MSME and agribusiness lending and demonstrating Pakistan’s ability to attract long term international capital. Non-Financial Additionality: The Project builds on IFC UA work approved in 2022 that enabled Pakistan’s DPR framework through targeted legal, regulatory, and tax reforms and UA support to BAFL to design and operationalize the DPR program in line with international best practices.

Indicator	Metrics	Comments
Value of Outstanding Loans, MSMEs	$

E&S Category Rationale / Risks and Mitigation

Environmental and social (E&S) risks and potential impacts associated with the supported financing activities, primarily targeting MSMEs, are considered limited and can be effectively managed through appropriate mitigation measures. As the overall portfolio risk is assessed as medium, the Project has been categorised as FI-2 in accordance with IFC’s Environmental and Social Sustainability Policy. The primary E&S risks relate to the nature of the financing activities, the adequacy of the Bank’s E&S management systems and capacity, and its ability to identify, assess, and monitor E&S risks associated with the financed activities under this transaction. Effective portfolio-level E&S due diligence and ongoing monitoring will be critical to maintain compliance with IFC requirements and to mitigate potential adverse impacts.

The Project will not support coal-related activities or higher risk business activities, including: (a) involuntary resettlement; (b) risk of adverse impacts on indigenous peoples; (c) significant risks to or impacts on the environment, community health and safety, biodiversity, and cultural heritage; (d) risk of retrenchment; or (e) significant occupational health and safety risks. For this Project, Bank Alfalah will be required to conduct systematic screening of eligible MSME and agribusiness loans against the IFC Exclusion List and applicable host country E&S laws and regulations. In addition, BAFL will comply with applicable life and fire safety standards and maintain labor and working conditions consistent with IFC Performance Standard 2. As part of the Project, BAFL will enhance its employee grievance mechanism in line with IFC standards.

Bank Alfalah has an Environmental and Social Management System (ESMS) in place that is aligned with the State Bank of Pakistan (SBP) Environmental and Social Risk Management (ESRM) Manual. The ESMS outlines E&S policy commitments, due diligence processes and procedures, tools, monitoring, and reporting requirements. The Bank has a dedicated team responsible for ESMS implementation. For this Project, the Bank will enhance the implementation of the ESMS for eligible loans in line with IFC requirements and strengthen relevant staff capacity on E&S risk management.

S.no	Title	Anticipated Completion Date
1	Training plan developed	05/02/2026
2	Relevant staffed trained	07/31/2026
3	Implementation report	07/31/2026
4	HR policies and procedures enhanced	05/02/2026

Contacts

For Inquiries About the Project, Contact

Bank Al Falah Limited
Farooq A. Khan
Group Head – Corporate, Investment Banking & International Business
+92-21-32461310
k.farooq@bankalfalah.com
Bank Alfalah Limited, Mezzanine Floor, Head Office, B.A. Building, I.I. Chundrigar Road, Karachi.
www.bankalfalah.com

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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.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

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/
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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.

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