BRAC launches new bank in sub-Saharan Africa

CaptureBRAC, an international development organisation based in Bangladesh, has transformed its microfinance operation in Uganda into a Tier two credit institution to provide financial access and support to Ugandans particularly in rural communities

The NGO stated that Enclude Capital Advisory UK Limited, a specialist investment bank owned by Palladium and a long-time partner of BRAC, was the sole financial advisor.

Three investors each acquired 17 per cent of BRAC Uganda Bank Limited. The new equity partners include German development finance institution DEG (Deutsche Investitions - und Entwicklungsgesellschaft mbH), Equator Capital Partners, an experienced fund manager investing in financial inclusion, and Triple Jump, a Dutch impact-focused investment manager.

BRAC International plans to use the proceeds from the sale to further expand its operations in other countries with low levels of access to finance.

Starting in 2006, BRAC Uganda now serves more than 200,000 clients, with its 163 branches in 84 districts across the country. BRAC pursued a change in its regulatory status as part of its commitment to providing a range of financial services specifically for women in rural and low-income communities.

With the new license, BRAC Uganda Bank Limited will be able to offer Ugandans savings accounts, money transfer, insurance and other financial services in addition to credit products.

Shameran Abed, the senior director of BRAC’s microfinance and ultra-poor graduation programme, said, “Becoming a bank is not the end in itself, but a means to an end.”

“We are now in a stronger position to not only provide far greater value to the hundreds of thousands of clients that we already serve but to achieve greater financial inclusion in Uganda by serving hundreds of thousands more who are outside of the formal financial system,” he added.

Speaking about the transition from a Tier four microfinance institution to a Tier two regulated Credit Institution, Jimmy Adiga, the CEO of BRAC Uganda Bank Limited, commented, “It has been a journey dubbed by the staff of BRAC at all levels as ‘a journey where execution meets passion’.”

Enclude director Alistair Mackie noted, “Our close partnership has enabled us to tailor the transaction process and select the right partners for BRAC in boosting much-needed financial inclusion in Uganda.”

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