DFC, IFC, and Raiffeisen Bank Ukraine Join Forces to Support Ukrainian Businesses

Two new risk-sharing facilities totaling $210 million will help to shore up SMEs and larger corporates, especially in agriculture and clean energy.

Facilities help provide critical financing to maintain operations, preserve jobs, and create value-add.

KYIV, UKRAINE - The U.S. International Development Finance Corporation, International Finance Corporation (IFC), and Raiffeisen Bank Ukraine today announced the establishment of two new risk-sharing facilities (RSFs) totaling approximately $210 million-equivalent. The facilities are set to address the critical financing needs of small and medium enterprises (SMEs) and larger corporates (midcaps) in Ukraine, helping them to grow their businesses, and preserve and create jobs.

RSFs enable multilateral development banks to share some of the risk of loss to lenders extending credit, particularly in a volatile market.

Through the first RSF, IFC and Raiffeisen Bank Ukraine will support smaller businesses, particularly in agribusiness, with up to $50 million shared equally. IFC's participation is backed by a partial guaranty through its Economic Resilience Action (ERA) Program, with support from the Swiss State Secretariat for Economic Affairs.

The second RSF, totaling €150 million, comprises contributions of up to €50 million from IFC and $50 million from DFC, with a focus on midcaps. Approximately 30 percent is expected to finance longer-term renewable energy generation and energy-efficiency projects to bolster Ukraine's energy security. This is the first direct cooperation between IFC and DFC to establish an RSF to promote access to finance by Ukrainian businesses. IFC's participation is backed by a partial guaranty from the French government with additional support from the UK's Foreign, Commonwealth and Development Office, both via IFC's ERA Program. DFC's financing is supported through collaboration with the U.S. Agency for International Development (USAID).

"Ukrainian businesses are at the center of DFC's efforts to strengthen Ukraine's economy today and into the future. Our support for the Ukrainian private sector is helping businesses continue to operate, employ workers, and provide vital goods and services that support the Ukrainian people and their economy. This financial support is key to building a prosperous and brighter future for Ukraine," said Justin Andrews, DFC's Acting Vice President of Small Business and Financial Services.

Russia's invasion has severely impacted Ukraine's private sector, disrupting supply chains, causing power outages and workforce shortages, and constraining the ability of banks to provide much-needed financing. According to World Bank data, a significant number of firms continue to exit the market, with 17 percent citing financial constraints.

The new RSFs aim to provide critical financing to businesses and represent IFC's fourth and fifth RSFs in Ukraine since February 2022, complementing previously committed RSFs under the Small Loan Guarantee Program, supported by the European Commission.

IFC has invested almost $2 billion to date, including $1.25 billion for its own account and $718 million mobilized from partners, to support Ukraine's private sector and prepare for reconstruction.

Ukraine is also one of DFC's largest markets, with $1.7 billion invested across sectors, including small business lending, energy, health, and more.

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The U.S. International Development Finance Corporation (DFC) partners with the private sector to finance solutions to the most critical challenges facing the developing world today. We invest across sectors including energy, healthcare, infrastructure, agriculture, and small business and financial services. DFC investments adhere to high standards and respect the environment, human rights, and worker rights.