Social Issue

In Kyrgyzstan as a result of the limited employment opportunities, many communities are reliant on members working abroad. In 2020, remittances made up 29% of the country’s GDP, making Kyrgyzstan one of the most remittance-dependent economies in the world.

The social and economic well-being of the population deteriorated following the COVID-19 outbreak in the second half of 2020 as remittances declined substantially during the pandemic.

Promoting domestic business opportunities is a key driver to reduce poverty in the country. Yet financial access to support micro-entrepreneurs, particularly in rural areas remains very limited. 

Our Response

The Netri Foundation first provided Kompanion a loan in 2013 with the objective to support its development and financial inclusion work. This new loan serves the same purpose but is provided in local currency so as to help the institution better manage its currency risk.

Kompanion’s approach to community development finance contributes significantly to the economic and social development of the Kyrgyz population through the provision of credit and other financial services as well as financial literacy and business training. It is particularly focused on remote and vulnerable rural communities and offers training to farmers through its team of agronomists and veterinarians who have been successful in increasing their yields and market opportunities for their farming activities.

Kompanion was created in 2004 from the merger of several women’s microcredit agencies and a financing agency for SMEs and was wholly owned by Mercy Corps International, which has a network of microfinance subsidiaries. In 2016, it converted into a bank to broaden the range of services it can offer to its clients, and a number of international development institutions entered as shareholders to assist its growth.

Expected Social Impact

With this investment of the Netri Foundation, it is estimated that Kompanion will be able to provide 239 microloans to their clients, with the expected outcome of enhancing their opportunities to generate income and improve their wellbeing.