Liwwa, Capital Bank of Jordan sign agreement to activate $10 million revolving line of credit

AMMAN — Liwwa, a  marketplace lender, and Capital Bank of Jordan signed an agreement to activate a five-year $10 million revolving line of credit backed by the Dutch Entrepreneurial Development Bank’s (FMO) NASIRA Portfolio Guarantee Programme. 

The signing of the NASIRA agreement closely follows liwwa’s fundraising efforts over the past year, during which $8.6 million and $4.9 million in additional debt financing were raised from the Capital Bank of Jordan and Bank Al Etihad respectively. Combined with the recent Series A-1 funding, liwwa was able to scale its lending operations in Jordan by 32 per cent in the first quarter of 2022 and to accelerate its expansion plans in Egypt, according to a NASIRA statement. 

Since its establishment in 2015, liwwa has underwritten over $80 million in loans to SMEs, a number that highlights the increasing need for tailored financial solutions targeting SMEs that lack robust financial documentation, collateral and credit history. 

Similarly, since 2015, liwwa’s peer-to-peer Marketplace has mobilised over $10.4 million in financing to SMEs through retail investors seeking to both support the Jordanian economy and earn competitive returns with an average historical IRR of 13.2 per cent.

Through this innovative risk-sharing facility, liwwa will benefit from enhanced liquidity, reduced cost of funds, and a cap to liwwa’s cost of risk during the NASIRA’s five-year lifetime, read the statement. 

NASIRA will further empower liwwa as it continues to lend to pandemic-impacted SMEs that would otherwise not secure access tofinancing to grow their operations and maintain a healthy liquidity position, according to the statement.

Liwwa’s CEO, Dennis Ardis said: “This exciting partnership between liwwa, Capital Bank of Jordan and FMO marks yet another step in liwwa’s journey towards promoting financial inclusion among SMEs, particularly those that are recovering from the COVID-19 pandemic.”

“Through its strategic partnerships with local and international lenders, liwwa remains well-positioned to continue scaling its lending activities, explore new markets and stay committed to its mandate of creating more income growth and job opportunities in its countries of operations through the highly impactful SME segment,” Ardis said.