IFC, a member of the World Bank Group, has provided $92.5 million in long term financing to four subsidiaries of Grupo Promerica in four Central American countries to boost access to finance for small and medium enterprises. Though small and medium enterprises are engines of job creation, representing 95 percent of all companies in Costa Rica, El Salvador, Guatemala and Nicaragua, more than half of them still lack access to finance, which limits their ability to grow.
IFC’s investment will support four different banks: Banco de la Produccion S.A. in Nicaragua ($30 million), Banco Promerica S.A in Costa Rica ($32.5 million), Banco Promerica S.A. in El Salvador ($20 million) and Banco Promerica S.A. Guatemala ($10 million).
Promerica’s subsidiaries in Nicaragua and Costa Rica will also use IFC’s funding to provide loans to companies that want to adopt more energy efficient practices and utilize cleaner energy sources. The objective is to help companies access credit to invest in clean energy projects. Nicaragua has extensive geothermal resources while Costa Rica, a global leader in renewable energy, is aiming to reach carbon neutrality by the end of 2021.
“Sustainability presents challenges for businesses, but also wide-ranging opportunities,” said Ramiro Ortiz Mayorga, President of the Board of Directors and CEO of Grupo Promerica. “Some financial institutions in the region are reluctant to provide credits to implement new technologies that they may not be familiar with. IFC’s support allows us to make funds available that are targeted to energy efficiency. It will also help us expand our portfolio for small and medium entrepreneurs. Their businesses generate the vast majority of jobs in Central America and provide essential goods and services.”
“One of the cornerstones of IFC’s strategy in Central America is to facilitate regional integration, which is critical to competitiveness,” said Luc Grillet, IFC’s Senior Manager for Central America and the Caribbean. “Our investment in Grupo Promerica will help a regional financial group expand access to small and medium entrepreneurs and to climate-related investments, through long-term funding to its subsidiaries.”
