IDB Invest, a member of the IDB Group, provided a $37.5 million loan with a tenor of up to five years to Banco Cuscatlán of El Salvador. This loan was managed by Imperia Intercontinental, Inc., Banco Cuscatlán’s main shareholder. The financing is expected to increase the availability of stable and medium-term resources for Banco Cuscatlán's small and medium-sized enterprise (SME) clients. The project also includes $12.5 million mobilized from the Chinese Co-financing Fund for Latin America and the Caribbean (“China Fund”).
IDB Lab, also part of the IDB Group, will support the project through a $750,000 technical cooperation, which seeks to support the development of Salvadoran SME through a digitization program to access a menu of financial and non-financial services focused on building capacity in business, management and technology. The technical cooperation project called "SME Digital Transformation", will have a comprehensive gender strategy to promote actions that help close the access gap to technology and credit in companies led by women.
SME are the most vulnerable economic segment in the COVID-19 context and this project is part of the IDB Group's response to provide financing to the sector and support transforming the economy to business models based on electronic platforms and digital financial services that allow SME to be competitive in the new normal.
In the post-COVID-19 economic reactivation process, IDB Invest financing will allow Banco Cuscatlán to expand its loan portfolio for SME in El Salvador, which constitute 90 percent of the country's businesses and employ approximately one million people, constituting 35 percent of GDP.
These operations potentially contribute to three United Nations Sustainable Development Goals (SDGs): Decent Work and Economic Growth (SDG 8), Industry, Innovation and Infrastructure (SDG 9), and Partnerships for the Goals (SDG 17).
About IDB Invest
IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social and environmental development in the region. With a portfolio of $12.1 billion in asset management and 333 clients in 24 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.
About IDB Lab
IDB Lab is the innovation laboratory of the IDB Group, the leading source of development finance and know-how for improving lives in Latin America and the Caribbean (LAC). The purpose of IDB Lab is to drive innovation for inclusion in the region, by mobilizing financing, knowledge, and connections to co-create solutions capable of transforming the lives of vulnerable populations affected by economic, social or environmental factors.
About Banco Cuscatlán
Banco Cuscatlán is the fastest growing bank in the last five years in El Salvador, the first in home loans and credit cards and the second largest bank in the country. It was recently selected as "Best Bank of El Salvador" by the prestigious magazines Euromoney and Global Finance. Additionally, it was awarded by Latin Finance as “Bank of the Year”, thanks to its solid performance and rapid growth.