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Regional: Supply Chain Finance Program (Additional Financing)

Nonsovereign (Private) Project | 46920-015 Status: Approved

The Board of Directors approved the Supply Chain Finance Program (SCFP) on a pilot basis in November 2012 with a revolving limit of $200 million, under which ADB provides guarantees and funding through partner financial institutions (PFIs) to support developing member countries' (DMC) small and medium-sized enterprises (SMEs)1. Technical assistance of $800,000 was approved in 2013 and used primarily to engage consultants to help implement the program.2 Obligations and liabilities under the Program are to be discharged by 31 August 2018 if the program is not renewed.

 
Project Name Supply Chain Finance Program (Additional Financing)
Project Number 46920-015
Borrower/Company ASIAN DEVELOPMENT BANK
Country Regional
Location Regional
Type or Modality of Assistance
2939 Guarantee Ordinary capital resources USD 25.00 million Approved
2939 Loan Ordinary capital resources USD 25.00 million Approved
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Knowledge solutions
Partnerships
Private sector development
Sector / Subsector

Finance / Banking systems and nonbank financial institutions

Industry and trade / Industry and trade sector development

Gender Equity and Mainstreaming Some gender elements
Responsible ADB Department Private Sector Operations Department
Responsible ADB Division Private Sector Financial Institutions Division
Responsible ADB Officer Beck, Steven
Project Sponsor(s)
Description

The Board of Directors approved the Supply Chain Finance Program (SCFP) on a pilot basis in November 2012 with a revolving limit of $200 million, under which ADB provides guarantees and funding through partner financial institutions (PFIs) to support developing member countries' (DMC) small and medium-sized enterprises (SMEs)1. Technical assistance of $800,000 was approved in 2013 and used primarily to engage consultants to help implement the program.2 Obligations and liabilities under the Program are to be discharged by 31 August 2018 if the program is not renewed.

This paper seeks the approval of the Board of Directors of the Asian Development Bank (ADB) for a major change in scope and amount for the Supply Chain Finance Program (SCFP or the Program). The proposed changes are derived from lessons learned during the SCFP's pilot phase, a market survey, and are aligned with the Program's developmental objectives. They are: (i) remove the program expiry date of 31 August 2018; (ii) increase the overall exposure limit from $200 million to $300 million; and (iii) broaden parameters to enhance the Program's scope and development impact by supporting innovative structures that may involve more risk.

Objectives and Scope
Linkage to Country/Regional Strategy

ADB's strategic priorities, as set forth in the Midterm Review of Strategy 2020, include finance sector development, poverty reduction, and inclusive economic growth. ADB's approach to inclusive economic growth emphasizes inclusive finance by improving and expanding access to finance for SMEs.

Inclusive finance is one of the three pillars of ADB's Financial Sector Operational Plan, which was reaffirmed in its 2017 review. One component of the strategic focus of ADB's Private Sector Operations Department is to mobilize third-party capital credit through credit enhancement products and risk transfer arrangements. The program facilitates this by encouraging private sector contributions to supply chain finance and enabling ADB to provide support to SMEs not traditionally considered bankable.

Safeguard Categories
Environment FI-C
Involuntary Resettlement FI-C
Indigenous Peoples FI-C
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
Timetable for assistance design, processing and implementation
Concept Clearance -
Credit Committee Meeting -
Approval 22 Mar 2018
Last PDS Update 12 Jun 2019

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Related Publications

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