International Finance Corporation (IFC), a member of the World Bank Group, and debt collection agency Collectius collaborate on debt recovery in Asia by launching a US$60 million platform to help banks deal with high levels of NPLs during pandemic.
IFC, Collectius have launched a US$60 million distressed asset recovery platform to address the impacts of Covid-19 on the banking sector and consumer finance in East Asia Pacific. The Asset reported.
The platform – covering Indonesia, the Philippines, Malaysia, Thailand, and soon Vietnam – will allow banks in the region to deal with their non-performing loans (NPLs) and focus on renewed lending, the two institutions said in a statement. The initiative seeks to help thousands of defaulted debtors meet their financial obligations and regain creditworthiness, thereby securing livelihoods and protecting jobs.
According to The Asset, IFC has acquired a minority stake in Singapore-based Collectius, at a post-money valuation of US$80 million. The company has raised a total of US$123 million in capital over six years.
“Given the Covid-19 crisis, high levels of non-performing loans can become a major problem in emerging economies, stalling credit flow and impeding growth. So, resolving NPLs is even more critical to maintain efficiency in intermediation for the financial sector,” says Rosy Khanna, FIG (financial institutions group) industry director for Asia and Pacific at IFC.
“As NPLs are resolved, economic recovery can pick up pace, helping financial institutions in Asia to unlock their capital and encourage new lending to local households and businesses.”
The initiative is part of IFC’s Distressed Asset Recovery Programme (DARP), which was launched in 2009 to address the sharp rise in NPLs after the 2008/2009 global financial crisis. Since its inception, DARP has grown to a total commitment of US$7.4 billion globally.
Global Business Services (GBS) LTD and Vietnam Insider join hands to present the “Inside Out” webinar series, shedding light on Vietnam’s situation during the COVID-19 period to support foreign investors dealing with a dynamic business, regulatory, legal and operational landscape.
The topic of 1st webinar will be “Market update & managing debtors under Covid-19 conditions” on 1 October, 2020, from 6pm Indochina Time (ICT), 6am EDT (US), 11am BST (UK). More details and registration here