Project Description
In response to the global financial crisis and the scarcity in long-term financing, IFC is giving high priority to existing clients to support strategic sectors with potential for repeat business, especially supporting high impact activities such as health and sustainable energy (“SE”) sectors, which are underserved segments by financial intermediaries in Turkey.
There remains a large gap in Turkey between the strong economic and environmental potential of SE projects versus their limited commercial realization. A major cause of this gap is the perceived risk of SE investments and the lack of effective project delivery capacity and financing mechanisms. Investment is necessary but by itself not sufficient to develop, implement and finance SE projects. Other services are needed to market SE projects programmatically to aggregated sets of energy users, prepare projects for investment working through the full project cycle, and build capacities of market actors including SE equipment and service companies, FIs, energy suppliers/utilities and end-user groups.
Despite the emergence of several large players, the private health sector in Turkey continues to be fragmented, with the majority of the providers being SMEs. Leasing in Turkey has been a major source of financing to this sector, albeit assets in this sector growing only recently at a reluctant pace given the limited appetite by financial intermediaries. There remains a large need to support financial intermediaries striving to provide SMEs access to finance on acceptable terms, which will in turn enable them to expand and modernize their operations.
This Project meets these strategic priorities both in SE and health sectors, through expanding SMEs’ access to finance as well as promoting SE among SMEs and indirectly contributing to the development and increased transparency of the private healthcare sector. Yapi Kredi Leasing (“YKL” or the “Company”) has a strong reach into SMEs and is keenly interested in expanding its business into health and SE. IFC will collaborate with other IFIs on an advisory services package that would provide assistance to expand the health and SE market in Turkey and particularly to Yapi Kredi Leasing in identifying, financing and monitoring these projects.