Ulaanbaatar, October 16, 2024 /MONTSAME/. Trade and Development Bank (TDB) successfully secured long-term concessional funding by signing a finance agreement with the U.S. International Development Finance Corporation (DFC) on September 30, 2024, noting a first-time direct correspondence of Mongolian banking and financial institutions with DFC, a U.S. Government Agency. This financing enables TDB to promote financial inclusion of women-owned/ led and micro, small, and medium entrepreneurship (MSME) and partially commits towards climate financing to accelerate green growth in Mongolia.

DFC was first established in 2018 through the passage of the BUILD Act (Better Utilization of Investments Leading to Development). DFC provides debt and equity financing, investments, feasibility studies, political risk insurance, and technical assistance in order to support economic growth, stability, and livelihoods in developing countries and also financing for MSMEs and women entrepreneurs to create jobs.

In the research conducted by DFC, MSMEs account for an estimated 50% of Mongolia’s employment and 90% of all registered businesses, playing an important contributor to economic growth of Mongolia, and a significant financing gap for MSMEs of USD 1.3 billion has also been estimated, out of which 62 percent is represented by women-owned/ led MSMEs. The International Finance Corporation has evaluated that Mongolia’s annual green investment need is nearly $700 million to transition to a more sustainable economy. Through this financing, TDB will contribute to making a positive development impact in Mongolia by increasing access to finance for the country’s growing MSME segment, including enterprises that are women-owned/led and/or seek to make investments in renewable energy and sustainable agriculture practices.

Trade and Development Bank remains committed to its long-term strategy of disbursing green financing of USD 2 billion by 2030 to Mongolia’s economy and is closely cooperating with international organizations to raise concessional funding.

As DFC is a prestigious international finance institution, we firmly believe this landmark deal will pave the way for Mongolia’s economy to access foreign funds from international investors and lenders.

Trade and Development Bank opened its U.S. Dollar direct clearing account at the Bank of New York Mellon for the first time since the country’s inclusion in the Financial Action Task Force (FATF) grey list and marked a reestablishment of Mongolia’s direct access to the global U.S. Dollar payment system. As a leading financial institution in Mongolia, Trade and Development Bank continues to extend its cooperation with U.S. institutions and once again demonstrates its commitment to serve as an accelerator in Mongolia’s economy and to fortify its collaboration with international counterparties.