Mongolia’s first digitally focused bank M bank has secured $30 million in financing from the International Finance Corporation (IFC) provide digital lending to women and small and medium enterprises (SMEs).
In a collaborative effort to bolster the Mongolian financial sector, IFC and M bank are also launching an innovative program in Ulaanbaatar.
This initiative is part of IFC’s broader strategy to foster an inclusive and sustainable financial landscape in the region.
With twenty-five percent of the funding specifically earmarked for women-owned SMEs, IFC is focused on addressing the financial disparities that hinder the economic potential of women entrepreneurs.
The partnership will also enhance M bank’s SME finance and supply chain finance products and services, while IFC provides technical guidance to advance the bank’s environmental and social management systems.
Despite SMEs employing about 70 percent of Mongolia’s workforce and contributing 17.8 percent to the GDP, access to finance remains a significant challenge.
According to 2019 World Bank Enterprise Surveys, a substantial 31 percent of firms in Mongolia reported full credit constraints, a figure that overshadows the average in the East Asia and Pacific region.
Temuulen Batmunkh, Deputy CEO of M bank, expressed optimism about the partnership’s potential to revolutionize digital lending and tailor financial solutions across Mongolia.
“We are also excited to pilot specific financial services for local businesses and merchants participating in supply chain,” Batmunkh added.
Since its inception in February 2022, M bank has shown rapid growth, with assets exceeding $200 million and nearly 40,000 borrowers as of December 2023.
Owned by MCS Group, one of Mongolia’s largest companies, M bank aims to expand its reach by leveraging MCS Group’s extensive network.
Rufat Alimardanov, IFC Resident Representative for Mongolia, highlighted the significant opportunities digital solutions present for Mongolia, the most sparsely populated country globally, to enhance nationwide access to essential services.
Over the past five years, IFC has injected $345 million into Mongolia’s financial institutions, providing both capital and strategic advice to cultivate market competitiveness and inclusive economic growth.
