The Article was published in Forbes Kazakhstan on July 30, 2025.
At the end of June, the International Finance Corporation (IFC) announced a strategic partnership with one of the leading microfinance organizations – Asian Credit Fund (ACF), providing $5 million loan. These funds will be used to support the fund’s core activities, namely lending to the micro-enterprises in the remote regions of Kazakhstan. The importance of this cooperation, the Company’s achievements in recent years, and plans for the future were outlined by Zhanna Zhakupova, Chairman of the ACF Management Board, and Talgat Salikhov, an independent member of the ACF Supervisory Board.
Zhanna, please tell us about the significance of the partnership with the IFC and what exactly these funds will be used for.
IFC is an international financial corporation that is a part of the World Bank. Cooperation with IFC is of great importance to our Company in terms of finance and reputation.
This partnership underscores the shared commitment of both organizations to promoting inclusive finance and fostering sustainable economic growth in Kazakhstan’s rural and low-income communities.
We first started communicating with IFC ten years ago, when they were interested in social focus of our lending activities. Approximately five years ago, we participated in the IFC project aimed at strengthening corporate governance within the company. Step by step, we reached the point where we were able to get funding from IFC. These funds will be used to support small businesses, micro-enterprises, and households in the rural areas.
How exactly does IFC select the companies with which to partner? What criteria are used?
Zhanna Zhakupova: IFC has a rigorous approach to due diligence, risk management, and analysis of the company’s business model. The Company shall meet high requirements for quality of corporate governance, ESG, operating performance, and financial strength. In addition to the financial performance requirements, IFC has requirements for the company’s development strategy. In this case, they appreciate our mission and the fact that we can confirm it: developing and supporting rural households and microenterprises in the remote regions of Kazakhstan. They are also impressed by our support for the women entrepreneurs. Among other things, this aligns with their mission and focus in our area.
Talgat Salikhov: It is worth noting that international development institutions such as the IFC, EBRD, and ADB, as a rule, provide collateral-free funding, i.e., they trust the partner’s business model and strategy. In essence, this is brand recognition, signaling to the market that the company has excellent corporate governance, a sustainable business model, a stable financial position, and excellent prospects. IFC’s mission is to improve the welfare of the population, which coincides with the mission of ACF. More than 200 microfinance organizations operate in Kazakhstan today, but fewer than five, such as ACF. These are the companies that issue loans exclusively for commercial and business purposes to support and develop microbusinesses in the regions. These are not consumer loans to buy new iPhones or TVs. This is targeted support for rural residents who face significant constraints on accessing borrowed funds. Muhhamad Yunus, who founded this approach in microfinance, won the Nobel Peace Prize in 2006.
How is your Company doing today? What financial performance did you end 2024 and the first half of 2025 with?
Zhanna Zhakupova: Our growth rate is relatively high, with the loan portfolio growing at about 40% per annum over the last three years. The portfolio quality remains higher than the market average, thanks to our clear understanding of our target audience and our ability to effectively reach them in rural areas. For 2024, as compared to the previous period, the assets grew by 22% to KZT 40.53 bln., the loan portfolio grew by 43% to KZT 37.1 bln., and net profit grew by 37% to KZT 1.5 bln.
At the same time, in lending, ACF adheres to the best practices of microfinance and the requirements of the financial market regulator to avoid excessive debt burden. All loan requests received by the Company are thoroughly analysed for the borrower’s solvency. To counteract fraudulent actions, the loan agreements are signed by borrowers at the ACF offices. The Company has an extensive rural branch network, which is convenient for the rural residents. Since the beginning of this year, over the last five months, as at 31 May 2025, the assets have grown by 15% to KZT 46.5 bln., the loan portfolio has increased by 11% and amounted to KZT 41.6 bln. and the net profit for the five months was KZT 485 mln.
How financially sustainable is the Company today? What are its main criteria for sustainability and reliability?
Talgat Salikhov: ACF has a very high-quality portfolio, with NPL below 5%. A combination of several factors helps to achieve this. The first is a unique business model: ACF lends to microentrepreneurs in the regions, primarily in rural areas. This segment of the projects differs by high margins higher than those of medium and large businesses. The second is rural mentality. In small communities, everyone knows each other, and non-repayment of the loan is condemned. People try not to fail and return money on time. The third is personal relationships. The Loan Officers often know their clients personally, and this impacts their discipline. The fourth is high portfolio diversification. ACF now has about 50 thousand clients, with a total portfolio of KZT 50 bln., this is a large, stable base. ACF is the second largest MFI in Kazakhstan by the number of clients.
Zhanna Zhakupova: High quality of the loan portfolio is due to several other factors: small loan cheque (the average loan amount today is about KZT 800 thousand), professional assessment of the client’s solvency, and presence of the guarantors – individuals.
Talgat Salikhov: I would like to add that the rural regions are generally more economically flexible and resilient to economic shocks. It is a more autonomous space, unlike, for example, medium and large businesses.
Zhanna, in November last year, the first issue of the bonds to the amount of KZT 2 bln. was placed at 21% per annum. How successful was this placement?
We believe placement was successful. To date, more than KZT 1.7 bln. of the planned KZT 2 bln. has already been placed.
Almost the entire investor base is individuals. The underwriter was BCC Invest, the key brokers were Teniz Capital Investment Banking and Standart Investment Company. We are grateful to all the brokers who assisted us with the securities issue.
Talgat Salikhov: We had a relatively slow start, but we understood why – the market was not familiar with the Company yet, and also the sharp change in the exchange rate at the end of last year made adjustments. However, we then saw quite high demand for our securities from the private investors. We do not have access to the institutional investors yet due to the lack of a credit rating.
We have deliberately not taken a credit rating yet as we are confident in our business model and financial strength. But there are plans to get it, of course.
What is the reason for issuing the bonds?
Talgat Salikhov: The main reason is the diversification of the funding sources. ACF receives resources from 15 European funds (Impact Funds) at a rate lower than that of issuing bonds on the market.
In fact, there is no immediate need for financing now, but we want to expand access to capital in advance – for a financial institution, this is more important than the cost of capital.
ACF’s current portfolio is about $100 mln. Given the expected growth of 30%, $25-30 mln. of additional funding will be needed next year, then $40-45 mln., and about $70 mln. a year later. We need to be prepared for this and ensure we have access to funding in advance.
This was the first issue under the total bond programme of KZT 6 bln. Will you place the securities for the remaining amount?
Zhanna Zhakupova: Yes, in early August, we plan to place the second issue of the bonds on the Kazakhstan Stock Exchange for the total amount of KZT 2 billion, for the term of 1.5 years, at the market rate.
The funds raised under the new issue will also be used for portfolio growth and expanding lending.
What are your plans for the company’s development in the next two or three years, five years? What are the strategic directions for the operations and investments? Have the terms and conditions of your products changed?
Zhanna Zhakupova: We have a big, ambitious goal – further digitalization of the business processes. In doing so, we have to take into account the uniqueness of our Company’s business model, where the personal relationships with our clients play a major role. That is, we can’t completely move customer service online. It’s important for them to come to the office, meet people, and discuss everything in person. We have developed a mobile app for loan officers. For the clients, it is being developed now and is not a priority.
We are also working on transitioning to a new, architecturally more advanced automated banking system (ABS), which will increase the speed of processing the requests and improve process efficiency.
As for the product changes, the maximum loan rates decreased from 42% to 37.8%, i.e. they became more affordable for the clients. Just so you know, we do not charge any additional fees.
We believe that digitalization will enable us to expand our presence in rural areas further and improve our operational efficiency. Therefore, even with a lower interest rate, we will continue being an efficient company due to our internal reserves and portfolio quality.
Microfinance Activity Licence No. 02.21.0008.М dated 04.03.2021 issued by the Agency of the Republic of Kazakhstan on Regulation and Development of the Financial Market.