Deutsche Bank and Home Credit Close ESG-Linked Loan for Financial Inclusion and Literacy
Deutsche Bank and PT Home Credit Indonesia, a global consumer financing company, announced today that they had closed an IDR156 billion ($10.4 million) ESG-linked credit facility focusing on ESG-related performance criteria.
This is Home Credit's first ESG-linked loan in Indonesia, as the company aspires to provide sustainable financial services and inclusive growth in Southeast Asia's largest economy and the world's fourth most populous country.
The loan's performance objectives are focused primarily on financial inclusion and literacy. Under the government's intention to reach its 90 per cent digital financial inclusion target by 2024, Home Credit will seek to grow both first-time and female consumers.
Home Credit will also utilise digital technology to provide consumer financing while maintaining the confidentiality of customer information.
Volker Giebitz, Director for Home Credit Indonesia, said:
“We understand the importance of operating responsibly and sustainably. ESG principles are embedded across our business as we serve our 5.5 million customers across Indonesia. We also apply those ESG principles to our innovative funding strategies. Through this loan collaboration with Deutsche Bank, we are further deepening our commitment to ESG and innovative funding at the same time.
“This funding will open broader opportunities for the Indonesian population, especially those who do not have access to formal financial services. Aside from providing affordable and transparent services that meet customer needs, we will additionally provide educational initiatives in several cities to increase financial literacy in Indonesia, alongside government efforts.”
Samir Dhamankar, Director, Head of Global Transaction Banking & Securities Services, Deutsche Bank, said:
“We are delighted to partner with Home Credit again on this significant transaction, first in the Philippines and now in Indonesia. This transaction allows Home Credit to strengthen its consumer lending footprint in Asia while furthering its commitment to pursuing a sustainable and financially inclusive agenda to better the welfare of communities and the economy. 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.”
The ESG-linked loan adheres to the Sustainability-Linked Loan Principles of the Asia Pacific Loan Market Association, which promote ecologically and socially sustainable economic activities, and performance targets will be independently validated by a third-party consultant.
Source: Deutsche Bank