MICROCAPITAL BRIEF: Inter-American Development Bank (IDB) Approves $50m Loan to Expand Access to Microcredit in Ecuador

The Inter-American Development Bank (IDB), a US-based multilateral finance institution, has approved a USD 50 million loan to expand access to microcredit in Ecuador, particularly among low-income women. The loan will be extended to the National Program for Finance, Entrepreneurship, and Economic Solidarity (PNFPEES), a government agency that provides loans to organizations in high-poverty areas that have limited access to credit.

IDB Specialist Rosa Matilde Guerrero said, “We expect that by 2015 the program will provide loans to approximately 25,000 microentrepreneurs. We also anticipate that these credits will lead to the creation of at least 5,000 new jobs over the next four years.” Despite growth in microfinance over recent years, Ms. Guerrero remarked that there is still insufficient supply of microfinance products due to the geographic concentration of credit for microenterprises, high operating costs and difficulty in meeting collateral requirements.

Seven microfinance institutions (MFIs) in Ecuador report to the US-based nonprofit Microfinance Information Exchange (MIX) an aggregate loan portfolio of USD 737 million, total deposits of USD 710 million, approximately 439,700 active borrowers and 167,600 depositors as of 2010.

By Kristha Abores, Research Associate

About Inter-American Development Bank (IDB):
The Inter-American Development Bank (IDB) is a US-based multilateral finance institution that was established in 1959 and operates in Latin America and the Caribbean. IDB works with governments, companies and nongovernmental organizations (NGOs) to provide both loans and grants to support small and medium-sized enterprises (SMEs), health, education and other sectors. IDB also provides technical assistance and research in these areas. Its Board of Executives is elected by 48 member countries, 26 of which are located in Latin America and the Caribbean. As of 2010, IDB reported total assets of USD 87 billion. The IDB is headquartered in Washington, DC, with offices also in Japan, France and all 26 member countries in Latin America and the Caribbean.

Sources and Additional Resources:

[1] IDB News Release: “Ecuador expands access to microcredit with IDB support,” http://www.iadb.org/en/news/news-releases/2011-12-07/ecuador-expands-access-to-microcredit,9746.html

MicroCapital.org article, October 25, 2011, “MICROCAPITAL BRIEF: Inter-American Development Bank (IDB) Group’s Multilateral Investment Fund (MIF) to Loan $7m to Root Capital and Microfinance Institutions FIDERPAC of Costa Rica, ASDIR of Guatemala; Announces $7m Equity Investment in CoreCo Central America I Fund; Rolls Out Psychometric Risk Assessment Tool,” https://www.microcapital.org/microcapital-brief-inter-american-development-bank-idb-group%E2%80%99s-multilateral-investment-fund-mif-to-loan-7m-to-root-capital-and-microfinance-institutions-fiderpac-of-costa-rica-asdir-of/

MicroCapital.org article, October 2, 2011, “MICROCAPITAL BRIEF: Inter-American Development Bank Approves Loan Worth $30m to Support Micro-, Small and Medium-Sized Enterprise in El Salvador,” https://www.microcapital.org/microcapital-brief-inter-american-development-bank-approves-loan-worth-30m-to-support-micro-small-and-medium-sized-enterprise-in-el-salvador/

MicroCapital.org article, September 9, 2011, “MICROCAPITAL BRIEF: Inter-American Development Bank (IDB) Syndicates $19m Loan for Municipal Marketplaces in El Salvador with Participation from Oikocredit, VDK Spaarbank, Bank Im Bistum,” https://www.microcapital.org/microcapital-brief-inter-american-development-bank-idb-syndicates-19m-loan-for-municipal-marketplaces-in-el-salvador-with-participation-from-oikocredit-vdk-spaarbank-bank-im-bistum/

MicroCapital Universe Profile: Inter-American Development Bank (IDB), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Inter-American+Development+Bank+%28IDB%29

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