Asialink Finance Corp, a Philippine-based lender to small and medium enterprises (SMEs) has received a proposed investment of up to $130 million from the International Finance Corporation (IFC), a member of the World Bank Group.
In a disclosure, IFC said the proposal comprises a senior loan financing package of up to $130 million, which comprises a four-year senior loan of up to $100 million from IFC’s account and $30 million from parallel lenders.
The proposed investment aims to support Asialink in expanding its financing to MSMEs, including women MSMEs, in the Philippines. In addition, IFC said it will provide a currency swap to help Asialink hedge the currency and interest rate risk from the IFC investment.
MSMEs account for more than 99% of business establishments and 63% of the workforce in the Philippines, contributing 40% to the country’s gross domestic product.
Asialink, established in June 1997, employs over 700 personnel and thousands of independent loan consultants. It has over 360 branches nationwide that serve the financing needs of businesses and individuals.
The company aims to provide “accessible, fast, and convenient” loans with competitive interest rates and fast processing time.
Asialink Finance Corp is 70% owned by the collective Lugtu Family, led by the founder, Ruben Lugtu II. Malaysia-based private equity firm Creador holds an 18% stake after it invested about $71 million in February. The remaining 12% is owned by the CEO and co-founder Robert Jordan Jr.
The firm is part of the Asialink Group of companies, which includes Global Dominion Financing Inc (GDFI) and South Asialink Finance Corporation (SAFC). The Creador investment led to the group consolidating, with Asialink Finance owning 100% of GDFI and 67% of SAFC.
IFC anticipates that the proposed investment will help Asialink Finance grow its loan portfolio of MSMEs, including WMSMEs. This will help reduce the access to finance gap for this segment. At the market level, IFC believes that the proposed investment will promote greater competitiveness in the MSME financing space by demonstrating the viability of lending to this space and encouraging other players to follow suit or develop more strategies, models, and products.Ibañez added that SCALE NCR aims to improve Metro Manila’s standing in the global startup ecosystem ranking, currently placed at 81st to 90th.