Consumer lender Home Credit has secured a $10.4-million ESG-linked loan facility from Deutsche Bank to push financial services and inclusive growth in Indonesia.
In a statement, Home Credit Indonesia said the facility is its first ESG-linked loan in Indonesia, Southeast Asia’s largest economy and the world’s fourth most populous nation.
Under the loan agreement, Home Credit will aim to increase first-time as well as female customers, in line with the Indonesian government’s plan to meet its 90% digital financial inclusion target by the year 2024.
In addition, the company, which has 5.5 million customers across Indonesia, will also tap on digital technologies to deliver consumer financing while ensuring strict customer data privacy.
“This funding will open broader opportunities for the Indonesian population, especially those who do not have access to formal financial services,” said Home Credit Indonesia director Volker Giebitz.
The short-term loan facility establishes clear metrics and key performance indicators (KPIs) with respect to ESG considerations, as well as concrete targets for those metrics that Home Credit has committed to achieving over the term of the loan.
The indicators would be measured and verified by an independent third-party advisor to make sure the loan complies with the Sustainability-linked Loan Principles of the Asia Pacific Loan Market Association.
Samir Dhamankar, director and head of global transaction banking & securities services at Deutsche Bank, said the loan facility allows Home Credit to strengthen its customer lending footprint in Asia while further its commitment in pursuing a sustainable and financially inclusive agenda.
“It also underscores the strength of our global transaction banking platform in one of Deutsche Bank’s fastest-growing markets, particularly in serving multinational corporates in the region,” Dhamankar added.
Home Credit Indonesia, headquartered in Jakarta, was established in 2013. It continues to grow its business to expand to into all cities and territories in the country.
“Here at Home Credit, we not only think of sustainability as an added factor or benefit but as a core value that we include in the way we run our business,” said Jean-Pascual Duvieusart, CEO of Home Credit Group, in a video posted on the company’s social media page.