MANAMA: Bahrain’s Grameen Bank, the first of its kind in the Gulf region, with the sole mandate to extend microcredit facilities at very competitive rates, will open for business on Dec. 23, a senior official revealed.
Hashim Hussain, the head of United Nations Industrial Development Organization (UNIDO), on the sidelines of a MENA-OECD seminar on small business said that the new bank, called Innovation Bank, would provide a lifeline to the small and medium enterprises in Bahrain.
According to OECD estimates, such businesses constitutes 93 percent of the total trade in Bahrain, and a microfinance bank dedicated to this segment means access to finance for this sector will no longer be an issue.
“UNIDO has assisted in setting up over 3,000 small and medium-sized businesses in Bahrain ... UNIDO is upbeat that the establishment of Innovation Bank will spur activities in private sector offering rare change for entrepreneurship development activities,” said Hashim.
The new entity is being setup following the formal approval of the Central Bank of Bahrain and the bank is 40 percent owned by the Arab Gulf Program for United Nations Development Organizations (AGFUND), 40 percent by Bahrain Development Bank and 20 percent by private investors.
The bank will have an authorized capital of BD10 million and paid-up capital of BD5 million. It will provide financial assistance to small-scale business starters including businesswomen.
Prince Talal bin Abdulaziz, AGFUND founder, had signed a memorandum of understanding with the Chairman of the BDB Shaikh Ebrahim Al-Khalifa last year paving the way for establishment of the Innovation Bank in Bahrain.
“The initiative to set up Innovation Bank is a result of UNIDO’s efforts to help the smaller businesses in Bahrain as well as across the region,” Hashim said.
