Tuesday, 19 July 2022 15:56

IDB Invest promotes women-led SMEs and green financing in El Salvador through Bancoagrícola

Written by Evelyn Alas

IDB Invest grants $70 million in financing to Bancoagrícola de El Salvador. The 10-year transaction seeks to boost the growth of the portfolios of small and medium-sized enterprises (SMEs), women-led SMEs, and green loans related to climate change mitigation, which will allow Bancoagrícola to solidify its strategy and specialized offerings in these segments.

The project has a mixed financing component in the form of economic incentives, with the support of the Women's Entrepreneurial Finance Initiative (We-FI), an alliance that aims to expand financing and access to financial markets for women-led businesses. Through this initiative, IDB Invest will provide the issuer with advisory services and a monetary bonus subject to the fulfillment of objectives related to the Pyme Mujer portfolio.

"Improving access to finance for SMEs is one of the biggest challenges in Latin America and the Caribbean. Together with Bancoagrícola, we are proud to boost the growth of women-led SMEs in El Salvador through this project, which will also support climate change mitigation thanks to the growth of the green portfolio in the country. Following our Vision 2025, we seek to incentivize sustainable and inclusive growth in El Salvador to achieve true long-term progress", said James Scriven, general manager of IDB Invest.

"We thank IDB and IDB Invest for their trust and support to the salvadoran productive sector; also to our clients, since it is thanks to their preference and commitment that we can continue to attract key investments to inject more capital to SMEs, women-led SMEs and green projects. We are happy and proud of the vote of confidence placed in salvadorans and in Bancoagrícola to continue promoting sustainable development for the well-being of all", said Rafael Barraza, executive president of Bancoagrícola.

The transaction is part of the WeForLac program of the We-Fi initiative, which seeks to increase access to financing for women entrepreneurs. This program will provide advisory services to strengthen Bancoagrícola's Pyme Mujer strategy and build capacity to reach a greater number of women-led SMEs. Support will also be provided to strengthen general impact measurement capabilities.

This operation is expected to contribute to five Sustainable Development Goals (SDGs) of the United Nations: Gender Equality (SDG 5), Decent Work and Economic Growth (SDG 8), and Reducing Inequalities (SDG 10), Climate Action (SDG 13) and Partnerships to Achieve the Goals (SDG 17).