Baku. 11 February. REPORT.AZ/ Islamic Corporation for the Development of the Private Sector (ICD), the private sector arm of the Islamic Development Bank Group (IDB), has consolidated its already significant support of Islamic finance in the Central Asian region, with the signing of a new agreement with leading Azerbaijani microfinance institution VisionFund AzerCredit (VF AzerCredit). The objective is to provide advisory services with the aim of developing a comprehensive Shariah-compliant microfinance solution for the country.Vision Fund AzerCredit was established in 1996 as a program of World Vision Azerbaijan, a relief organization created to provide credit to underprivileged and disenfranchised people and offer them the opportunity to control their own finances and future. In 2002, VF AzerCredit was successfully registered as a Limited Liability Company in Azerbaijan, following which it obtained a central banking license in 2003. Its work emphasizes the provision of loans to small and micro entrepreneurs in rural areas, especially those remote regions which remain largely unbanked, through 45 outlets in 38 districts. With more than 80,000 borrowers and a portfolio of over US$83 million, the group is a leader in the Azerbaijani microfinance field and the perfect partner for the private sector investment activities of the ICD.
The ICD is one of the primary drivers of Islamic finance and private sector growth in the Central Asian region, and has conducted a number of previous projects in Azerbaijan: a 2013 $3 million SME financing agreement with local lender Muganbank, a stake in the country's first Takaful venture, and multiple loans and SME allocations to Azerbaijani banks, institutions and projects. As of 2014 ICD had already invested over $99.3 million in Azerbaijan's economy. The investment was directly in development project like Baki Plaza project and through lines of finance to the International bank of Azerbaijan (IBA), Rabita Bank, UniBank, Demir Bank, Mugan Bank, Amrah Bank, Standard Bank and Turan Bank. ICD is also a stakeholder (along with the Azerbaijan Investment Company) in the Caspian International Investment Company (CIIC).
The VF AzerCredit agreement represents the latest step in the ICD's comprehensive program to support and develop the growth of the private sector in one of the most promising new regions of the Islamic global economy.