IFC and OTP Leasing, a leading leasing company in Ukraine, are launching a €50 million risk sharing facility (RSF) to expand financing for small and medium enterprises (SMEs) and larger companies (midcaps). The initiative aims to fund sectors such as agriculture, manufacturing, trade, energy, and logistics, focusing on sustainable energy solutions that enhance Ukraine’s energy resilience.
Amid Russia’s invasion, Ukraine has suffered a significant loss of productive capacity due to supply chain disruptions, power outages, and labor shortages. The high-risk environment has also constrained lending to the private sector, with corporate credit dropping from 12.8 percent of GDP in 2021 to 9.2 percent in 2024. The leasing sector, a critical alternative for accessing credit, contracted by 59.4 percent in 2022 and has only partially recovered with government and development finance support. Ukraine has lost nearly two-thirds of its energy generation capacity since Russia’s invasion, highlighting the need for decentralized, resilient power systems.
The RSF will support OTP Leasing in extending new leases, particularly to underserved SMEs and midcaps that prioritize small-scale renewable energy generation and energy-efficient, sustainable projects, in particular climate-smart agriculture and green vehicles. Under this RSF, IFC will take up to 50 percent of the credit risk, with a maximum risk exposure of €25 million. As part of the project, a 10 percent capital expenditure buydown mechanism will incentivize lessees to choose sustainable solutions over more polluting alternatives.
IFC’s participation in the RSF and the capital expenditure buydown mechanism are supported through IFC’s Economic Resilience Action (ERA) Program for Ukraine, which includes a contribution from the United Kingdom’s Foreign, Commonwealth & Development Office.
“We are proud to partner with IFC on this important €50 million RSF deal, which includes a capital expenditure buydown component. This collaboration will strengthen our ability to provide our clients with sustainable and innovative leasing solutions, promote economic growth and support Ukraine’s resilience in challenging times,” said Andrii Pavlushyn, CEO, OTP Leasing Ukraine.
Andrew Ockenden, Chargé d’Affaires, British Embassy Kyiv, said: “The UK stands firmly behind Ukraine’s green, sustainable economic recovery. This deal will not only respond to immediate needs of SMEs but help build a more sustainable future economy for Ukraine and help develop green technologies that might be later exported to other countries. This approach reflects key priorities behind the 100-Year Partnership Agreement that Prime Minister Keir Starmer and President Volodymyr Zelenskyy signed earlier this year.”
“This partnership with OTP Leasing will expand access to financing for Ukrainian businesses, particularly in critical sectors like agribusiness, manufacturing, and logistics,” said Lisa Kaestner, IFC’s Senior Country Manager for Ukraine. “The initiative will help businesses invest in sustainable energy solutions such as climate-smart agriculture, small-scale renewable energy generation, and energy-efficient projects. These efforts aim to strengthen the country’s economic resilience during a time of unprecedented challenges.”
RSFs allow IFC’s partner financial institutions to share the credit risk on portfolios of eligible credit instruments, helping to support new financing, particularly in volatile markets. In total, IFC’s RSF program in Ukraine, including this project, is expected to enable approximately $1 billion in new private-sector financing.
Since February 2022, as part of its Economic Resilience Action (ERA) Program for Ukraine, IFC has delivered $2.5 billion to support Ukraine’s private sector, including $940 million in mobilized financing. The ERA Program is an operational framework for near-term investments and advisory work to assist the Ukrainian private sector following Russia’s invasion and includes financing at IFC’s own risk and blended finance support from multiple development partners to mitigate risk. For more on IFC’s ERA Program for Ukraine, see here.
IFC’s work in Ukraine is part of the World Bank Group’s response package, which has assisted more than 20 million Ukrainians by helping businesses stay afloat and enabling the government to provide essential services, pay wages, keep schools and hospitals open, and carry out critical repairs.
