50776 - MFP-BOP KIMS

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Summary of Investment Information

Project Number

50776

Company Name

KIMS MICROFINANCE

Date SPI Disclosed

Mar 13, 2026

Country

Federal Republic of Somalia

Region

Africa

Projected Board Date

Mar 10, 2026

Environmental Category

FI-3 - No Impact

Status

Pending Signing

Last Updated Date

May 15, 2026

Department

Regional Industry - FIG Africa

Industry

Financial Markets

Previous Events

Approved : May 13, 2026

Sector

Microfinance and Small Business - Non Commercial Banking

Additional Project Attributes

Blended Finance

Project Description

The proposed IFC investment comprises a 3-year, Sharia-compliant senior loan of up to US$1 million to KIMS Microfinance (KIMS or the Company). The proceeds will be on-lent to micro and very small enterprises in Somalia to address the financial inclusion gap and simulate job creation in a country where an overwhelming 67 percent of the population live below the poverty line (the Project).

The Project will be included in the FIG MSME Platform which is supported by a pooled first loss guarantee (“PFLG”) of up to US$40 million provided by International Development Association (IDA) 20 Private Sector Window Blended Finance Facility (IDA20-PSW BFF) allocated to the Base of Pyramid (BOP) Envelope under the MSME Finance Platform.

Associated Advisory Engagement

KIMS Microfinance has been an IFC advisory client since 2018. In the initial engagement, IFC’s FIG Advisory team supported KIMS in developing its Strategic Business Plan together with comprehensive financial projections and operational plans.

In 2021, IFC engaged in a second follow-on advisory partnership with KIMS to support the implementation of this plan, resulting in significant improvements in portfolio quality, operational self-sufficiency, and institutional sustainability.

Building on this success, IFC partnered with KIMS in November 2025 for a third follow-on advisory engagement to support its next phase of growth. This engagement focuses on strengthening key areas including risk management, corporate governance, product development, and strategic planning.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	1.0
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 Microfinance

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

Development Impact

The Project is expected to expand access to finance for microenterprises in Somalia by providing long term funding to KIMS, a leading microfinance institution. Access to formal finance remains extremely limited, with fewer than 5 percent of adults actively using bank accounts and only 4.7 percent of small firms having a bank loan. By easing KIMS’ funding constraints, the Project will support the growth of its Shariah compliant microlending operations, including products targeting women, and help scale outreach to underserved microenterprises. Competitiveness: The Project will enhance competitiveness in Somalia’s microfinance sector by supporting a market leading provider with long term funding and continued advisory support. This will contribute to credit market deepening in one of the world’s least penetrated financial systems, promote product diversification, and demonstrate the viability of commercial funding following recent financial sector reforms. IFC’s engagement is expected to catalyze broader participation of external financiers as institutional capacity across the sector improves.

IFC’s additionality in the Project is both financial and non-financial. Financial Additionality is provided in the form of (i) Financing Structure through longer term USD funding that is not readily available in the Somali market; and (ii) Resource Mobilization, as IFC will mobilize up to US$2 million through parallel lenders. Despite strong demand, KIMS’ growth is constrained by limited funding, as most financial institutions rely on self funding, concessional resources, or donations. IFC’s non-financial additionality is in the form of Knowledge, Innovation, and Capacity Building as IFC will continue to provide advisory support focused on strengthening risk management, corporate governance, and product diversification. Building on the initial advisory engagement that enabled KIMS’ first access to semi commercial funding, this support aims to further enhance operational capacity and facilitate sustained access to external funding.

Indicator	Metrics	Comments
Number of Outstanding Loans, Microenterprises	number
Value of Outstanding Loans, Microenterprises	$
Direct Employment (#) Operations And Maintenance	individuals

E&S Category Rationale / Risks and Mitigation

This Project will support on-lending to micro enterprises in Somalia. The E&S risks and impacts associated with these activities are considered low and the project has therefore been classified as a category FI-3 project in accordance with IFC's Sustainability Policy.

The Project will not support any activities with significant E&S concerns such as: (a) activities involving harmful or exploitative forms of forced labor and harmful child labor; (b) production, trade, storage, or transport of significant volumes of hazardous chemicals, or commercial scale usage of hazardous chemicals; (c) risk of adverse impacts on Indigenous Peoples.

The client’s financing activities will be required to meet the requirements of the IFC's Exclusion List and other exclusions deemed necessary. The client will update their E&S policy document to clearly outline the criteria used for E&S risk screening and how national legal compliance is assessed. The client will also be requested to align their exclusion list with that of the IFC as it is currently in partial alignment, as well as enhance its grievance policy to enable anonymous reporting and update their life and fire safety measures to ensure alignment with Somali’s Labor Code (1972).

The client has an E&S policy in place that is generally adequate to manage the relatively low risk associated with their microfinance portfolio. The client undertakes E&S screening of loans at the branch level and by credit officers; the client will update their E&S policy document to clearly outline the criteria used for E&S risk screening, how national legal compliance is assessed and outcomes of such screening. The client will also be requested to align their exclusion list with that of the IFC as it is currently in partial alignment.

S.no	Title	Anticipated Completion Date
1	Exclusion List	06/29/2026
2	Grievance Mechanism	12/31/2026
3	Life and Fire Safety	12/31/2026

Contacts

For Inquiries About the Project, Contact

KIMS Microfinance
Abdisalam Abdilahi Ali
CEO
+252-63-4772555

For Inquiries and Comments About IFC, Contact

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Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384

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.

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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.

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.

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