New Islamic finance initiative aims to expand SME access to funding, support private sector growth, and strengthen economic resilience in Azerbaijan
The Islamic Corporation for the Development of the Private Sector (ICD) and TuranBank have signed an Expression of Intent for a proposed USD15 million Shariah-compliant financing facility. The initiative aims to improve access to capital for small and medium enterprises (SMEs) in Azerbaijan.
The organisations signed the agreement on 17 June 2026 in Baku. The signing took place during the Private Sector Forum alongside the Islamic Development Bank (IsDB) Group Annual Meetings. The proposed facility marks another milestone in the long-standing partnership between ICD and TuranBank while reinforcing efforts to support private sector development through Islamic finance solutions.
Subject to due diligence and internal approvals, ICD plans to extend the financing facility to TuranBank. TuranBank will then provide funding to eligible SMEs across Azerbaijan. The initiative aims to address financing gaps faced by smaller businesses. These enterprises continue to play an important role in economic growth, job creation and innovation.
Expanding SME Access to Shariah-Compliant Financing
Access to affordable financing remains one of the key challenges facing SMEs in many developing economies. Through this proposed line of finance, ICD aims to increase the availability of Shariah-compliant funding while supporting entrepreneurship and business expansion within Azerbaijan’s private sector.
TuranBank has extensive experience in MSME and SME financing. The bank will use its existing infrastructure and customer network to distribute the funds efficiently. This approach allows financing to reach a broad range of businesses that may otherwise struggle to secure growth capital through traditional lending channels.
The facility aligns with ICD’s broader mission of promoting sustainable economic development through private sector growth across its member countries.
By supporting SME financing, the organisation seeks to strengthen business resilience, encourage investment activity and create employment opportunities.
Building on a Long-Standing Partnership
The latest agreement further deepens a relationship that has spanned nearly two decades.
ICD first began working with TuranBank in 2006 and has since committed more than USD 33 million through various financing arrangements. Among these was a USD 15 million Line of Finance concluded in September 2025, highlighting continued confidence in TuranBank’s ability to support SME development in Azerbaijan.
The new Expression of Intent signals both organisations’ commitment to expanding their collaboration and increasing the availability of Islamic finance solutions for businesses operating in the country.
Supporting Economic Growth Through Islamic Finance
The proposed financing facility reflects the growing role of Islamic finance in supporting economic development and financial inclusion. By providing Shariah-compliant funding for private sector projects, ICD aims to help businesses access the capital needed to expand operations, improve competitiveness and contribute to national economic growth.
Furthermore, the initiative supports ICD’s mandate to mobilise private sector financing across its 56 member countries. Through strategic partnerships with financial institutions such as TuranBank, the organisation continues to promote sustainable investment, strengthen SME ecosystems and foster long-term economic resilience.
As Azerbaijan continues to prioritise private sector development, initiatives such as this proposed USD 15 million facility demonstrate how Islamic finance can serve as a practical tool for expanding SME access to funding while supporting broader economic transformation.
