• IFC signs $10 million risk-sharing deal with Dashen Bank

• Guarantee backs $20 million SME lending, targeting agri-food, women-led firms

• Deal supported by IDA first-loss guarantee, technical assistance included

The International Finance Corporation (IFC), the private-sector arm of the World Bank Group, has signed a $10 million risk-sharing agreement with Dashen Bank, one of Ethiopia’s leading private lenders. The deal was announced Tuesday, February 17, 2026.

The guarantee will cover up to 50% of the credit risk on a loan portfolio of up to $20 million, enabling the bank to expand financing to small and medium-sized enterprises (SMEs), particularly in the agri-food sector and women-led businesses.

The transaction is backed by a first-loss guarantee from the IDA Private Sector Window, a $2.5 billion initiative aimed at mobilizing investment in higher-risk markets.

The structure allows Dashen Bank to lend to higher-risk SMEs while limiting its exposure. It also includes technical assistance to strengthen credit assessment, tailor loan products and enhance risk management, with the aim of generating lasting benefits for businesses and the broader economy. In emerging markets such as Ethiopia, SMEs drive economic activity and job creation, yet limited access to credit continues to constrain their growth.

“This initiative not only enhances our capacity to support local enterprises but also mitigates risk, enabling us to focus on our core mission: fostering entrepreneurship and promoting sustainable development,” said Asfaw Alemus, CEO of Dashen Bank.

The deal underscores IFC’s commitment to transforming Ethiopia’s financial system to expand opportunities and empower entrepreneurs, said Ethiopis Tafara, IFC Vice President for Africa. IFC said it committed $605 million in Ethiopia in fiscal year 2025 across the telecommunications, agri-food and manufacturing sectors.

SG