Salvador Ifc Helps Tender

IFC a member of the World Bank Group is working with Banco Agricola to support micro small and medium enterprises MSMEs women-owned SMEs WSMEs housing for underserved segments and climate-smart investments including green buildings in El Salvador with a 330 million financing package.MSMEs represent nearly all of El Salvadors enterprises but just over 40 percent of firms have a bank loan or line of credit. The barriers are even higher for women with only 24 percent of women-owned businesses with access to a bank account. Despite the countrys high rate of urbanization low- and middle-income Salvadorans struggle to obtain affordable mortgage options from commercial institutions.IFC is providing up to 330 million in financing that will back Banco Agricolas objective of better reaching these underserved segments promoting financial inclusion and increasing formality. In addition the leading Salvadoran bank will play an important role in climate change mitigation by funding climate-smart assets projects in El Salvador.The financing package consists of loan up to 180 million from IFC on its own account 50 million from by IFCs Managed Co-Lending Portfolio Program MCPP and up to 100 million mobilized by IFC from international impact investors. Of the total package 30 million will be channeled to provide short-term working capital needs of Salvadorian MSMEs helping them to cope with the impact of the COVID-19 pandemic. IFCs financing package also includes a performance-based incentive from the Women Entrepreneurs Finance Initiative We-Fi of up to 583000 for lending to woman-owned SMEs.SMEs and women entrepreneurs are facing greater difficulties to get the funding required to run their day-to-day business. IFC aims to help them address this immediate need while promoting better access to credit in the long-term said Sanaa Abouzaid IFCs Regional Manager for Central America.This support to the financial sector will also help preserve the markets ability to foster economic recovery as conditions normalize while also demonstrating the viability of financing MSME WSME climate-smart assets and housing for low- and middle-income segments.Banco Agricolas CEO Rafael Barraza noted More than 30 of our countrys workforce is generated by micro and small businesses and it is important to support them with tools that protect them in the midst of this crisis ensuring their resilience in the market and the preservation and generation of jobs in the country. As the bank of Salvadorans we recognize our commitment and responsibility and for that reason we want to contribute to the efforts already being made by different sectors with these types of financial injections because El Salvador needs us all.The engagement includes an advisory component supported by We-Fi to help identify business opportunities that address specific banking needs for WSMEs in El Salvador and scale up their access to financial products and services.Furthermore IFC will provide Banco Agricola with support to establish a new climate finance business line and thereby become one of the first banks in El Salvador to grow its portfolio of climate-smart assets including sustainable construction activities for green buildings and housing. IFC will share its knowledge on green buildings and equip the Bank with its Excellence in Design for Greater Efficiencies EDGE green building certification tool.