The French Development Agency (AFD) confirmed Wednesday that it will sign $6 million worth of loan agreements with three microfinance institutions (MFIs) to help rural households purchase solar panels and electricity.
AFD will provide the loans to Cambodian MFIs KREDIT, Thaneakea Phum and Vision Fund, which in turn will offer low-interest loans to 25,000 rural families across the country, the agency’s press officer, Tung Soklim, said in an email Wednesday, adding that the deals are scheduled to be signed Friday afternoon.
“We are working with the three microfinance institutions so we can offer loans to them and then Cambodian households can borrow money from them to buy solar panels and electricity,” AFD director Andre Pouilles Duplaix said at a product fair in Phnom Penh last week.
Preap Piseth, a senior operations manager at Vision Fund, said Wednesday that AFD will charge the MFIs between 2 and 4.5 percent interest per year, and that Vision Fund will charge recipients of the loans a maximum of 2.5 percent annual interest.
“Individuals who are qualified for the loans must have legitimate businesses or occupations,” Mr. Piseth said.
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