The Netherlands, GIZ, CBJ sign co-funding agreement to support MSME financial inclusion

AMMAN — The Netherlands's embassy in Jordan, the Central Bank of Jordan (CBJ), and the German Agency for International Cooperation (GIZ) announced on Tuesday a co-funding agreement to support the "Innovative Approaches for Financial Inclusion of Micro, Small, and Medium Enterprises (MSMEs) in Jordan" (I-FIN) project.

The Netherlands will contribute 1.5 million euros to boost financial inclusion initiatives, with a special focus on empowering women-led MSMEs and promoting digital financial innovations, according to a CBJ statement. 

The Federal Government of Germany, through the Ministry for Economic Cooperation and Development (BMZ), is funding the project with 10 million euros from 2021 to 2025.

The ceremony was held at the Netherlands’ embassy in Amman and was attended by Dutch Ambassador Harry Verweij, Deputy Governor of the CBJ Ziad Ghanma, and German Ambassador Bertram von Moltke.

The speakers highlighted the importance of partnerships in driving inclusive economic growth, job creation, and innovation, according to the statement. 

Verweij highlighted the Netherlands' commitment to fostering private sector development in Jordan, saying: "Through this co-funding agreement, we are advancing one of our core development objectives: enhancing access to finance for MSMEs and promoting financial inclusion, particularly for women-owned businesses." 

Ghanma commended the I-FIN project for its role in enhancing Jordan’s financial ecosystem. "This partnership with The Netherlands will further scale up innovative financial solutions, fostering greater financial inclusion for small companies and driving job creation," he said.

von Moltke reiterated Germany’s support for Jordan’s financial inclusion efforts, noting that the partnership with The Netherlands marks a crucial step in building a more inclusive and resilient financial sector.

During the event, participants reviewed the CBJ’s achievements in financial inclusion and financial technology, underlining the importance of continued cooperation among the private sector, government institutions, and international organisations to overcome challenges. 

MSMEs, which make up over 99.4 per cent of Jordan’s private sector and employ 89.7 per cent of the workforce, were identified as a critical driver of economic growth, despite facing limited access to financial services, according to the statement. 

A recent survey by the CBJ and GIZ said that financial inclusion remains low in Jordan, with only 6.9 per cent of MSMEs holding an outstanding loan or line of credit, and just 52 per cent having a bank account or e-wallet.

The report underscored the urgent need for customised financial services, mainly for women-led businesses.

The I-FIN project, running until 2025, aims to enhance access to innovative financial services for MSMEs and improve Jordan's regulatory environment. 

With the additional support from The Netherlands, the project will expand efforts to support CBJ’s transition to risk-based supervision, promote digital financial innovations, and provide tailored services for women-led MSMEs, contributing to sustainable financial inclusion and economic development in Jordan.