MICROCAPITAL BRIEF: International Finance Corporation (IFC) Appoints Nepal’s White Lotus Centre to Manage Business Oxygen Private Equity Fund to Invest in Small, Medium-Sized Enterprises (SMEs)

The International Finance Corporation (IFC), a member of the US-based World Bank Group that aims to support economic growth in developing countries, recently announced that it has appointed White Lotus Centre Private Limited, a Nepalese advisory firm which specializes in “private sector development, public communications and project management”[2], as the fund manager for Business Oxygen, a private equity fund in Nepal that was founded in 2012. In 2013, IFC invested USD 7 million in Business Oxygen, which has a total of USD 14 million in assets. As Business Oxygen’s fund manager, White Lotus Centre will invest in Nepalese SMEs on a collateral-free basis with the goal of growth and job creation.

Wendy Jo Werner, IFC’s country manager for Bangladesh, Nepal, and Bhutan, added that “Business Oxygen Fund’s ability to provide risk capital to SMEs in Nepal provides a vital solution for firms too small or too new for traditional commercial bank financing”[1]. Siddhant Raj Pandey, the chairman of White Lotus Centre, said that “despite the challenges posed by this year’s earthquake, there is significant potential for SMEs in Nepal. White Lotus will develop a robust portfolio of investee firms that will become a strong contributor to Nepal’s commercial growth”[1].

As of 2014, IFC has 184 member countries that drive its policies and approve disbursements. Also as of 2014, IFC reported total assets of USD 84 billion, net annual income of USD 1.5 billion and return on assets of 1.8 percent. In Nepal, approximately 111,000 SMEs create 22 percent of the country’s GDP and provide employment for 1.75 million people [1]. Financial information on White Lotus Centre is unavailable as of 2015.

By Alíz Crowley, Research Associate

About Business Oxygen

Business Oxygen is a private equity fund in Nepal. The organization was established in 2012 with the aim of investing equity and quasi-equity in small and medium-sized enterprises (SMEs) in Nepal. The International Finance Corporation (IFC) owns a 50-percent equity stake in the organization based on an investment with a value of USD 7 million. Business Oxygen is part of IFC’s “SME Ventures” program, an initiative that supports “risk capital funds”[1] that operate in fragile and post-conflict environments.

About White Lotus Centre Private Limited

White Lotus Centre Private Limited is an advisory firm in Nepal that offers advisory services on “private sector development, public communications and project management”[2]. The organization’s mission is to contribute to the development of the private sector in Nepal and the growth of the country’s economy. Financial information on the organization is unavailable.

About the International Finance Corporation (IFC)

The International Finance Corporation (IFC), a US-based multilateral development bank and member of the World Bank Group, offers loans, equity investments, advisory and risk mitigation services and technical assistance to private companies with the intent of alleviating poverty and promoting open and competitive markets in developing countries. As of 2014, IFC has 184 member countries that drive its policies and approve disbursements. Also as of 2014, IFC reported total assets of USD 84 billion, net annual income of USD 1.5 billion and return on assets of 1.8 percent.

Sources and Additional Resources

[1] International Finance Corporation, News, IFC Appoints White Lotus as Fund Manager for ‘Business Oxygen’ to Support SME Growth in Nepal

[2] White Lotus Centre, About Us

[3] LinkedIn, Business Oxygen (BO2)

MicroCapital Universe Profile: White Lotus Centre Private Limited

MicroCapital Universe Profile: Business Oxygen

MicroCapital Universe Profile: International Finance Corporation (IFC)

MicroCapital Universe Profile: World Bank Group (WBG)

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