International Finance Corporation
The International Finance Corporation (IFC) is a World Bank Group institution that invests in and advises private businesses in developing countries.
Development finance institution: An institution that provides financing or risk-sharing to promote economic and social development. The IFC is a multilateral example of this broader kind of institution.
Emerging markets: Economies undergoing industrialization and integration into global markets, often with rapidly changing institutions and capital access. The IFC operates across these economies, where financing constraints and growth opportunities often coincide.
World Bank Group: A group of international institutions that finance development and provide advice to countries and businesses. The IFC is one of the group's institutions, with a private-sector mandate distinct from its public lending arms.
Multilateral Investment Guarantee Agency: A World Bank Group institution that provides political risk insurance and credit enhancement for cross-border investment. MIGA primarily guarantees investments, while the IFC also lends, invests, and advises businesses.
Equity investment: The purchase of ownership shares in a company, creating a claim on its residual value. The IFC can invest directly in companies by taking ownership stakes.
Microfinance: Financial services, especially small loans, designed for people and enterprises with limited access to conventional banking. IFC investments and advisory work have supported private microfinance providers.
Bretton Woods Conference: The 1944 conference that established the framework for the postwar International Monetary Fund and World Bank. Its institutions formed the postwar setting in which a private-sector development arm was later proposed.
European Bank for Reconstruction and Development: A multilateral development bank that supports private enterprise and market economies, principally in Europe and neighboring regions. Like the IFC, it finances private firms, but its geographic mandate is narrower.
Syndicated loan: A loan provided jointly by a group of lenders under a shared agreement. The IFC arranges lender groups to extend financing beyond its own balance sheet.
Renewable energy: Energy produced from sources replenished naturally, including sunlight, wind, and flowing water. IFC financing supports private renewable-energy projects in developing economies.