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IDB Invest Joins Forces with SURA Investments to Support Colombia's Private Credit Market

IDB Invest will invest up to 100.2 billion Colombian pesos (approximately $25 million) in the FCP SURA Private Debt Fund, which provides tailored financing in local currency to small and medium-sized enterprises (SMEs) and middle-market companies in Colombia. The fund's primary focus will be businesses that require customized financing solutions to support growth opportunities and improve productivity. 

The deal aims to support the sustainable growth of Colombian SMEs and companies through access to the private credit market. Additionally, the transaction will help develop the private credit industry in Colombia, by supporting the first generation of investment vehicles focused on this sector in the country.

In Colombia, SMEs represent around 67% of employment, but only 40% of them have requested financing from commercial banks due to high transaction costs, among other factors. Gaining access to alternative sources that could complement commercial banking credit, such as private debt financing, could reduce the financing gap for Colombian SMEs.

Mid-market companies also face challenges accessing financing, despite being larger and more mature companies. Their basic working capital needs are met through short-term lines of credit provided by commercial banks. However, they still have little access to longer-term financing sources that allow them to make investments to accelerate their growth trajectory.

This is IDB Invest’s second investment of its type in Colombia. It aims to help establish a new asset class and encourage market pioneers to incorporate sustainable investment practices. In addition, the deal has an innovative technological component since the fund has an agreement with a Colombian fintech that will generate sub-loans to SMEs, contributing to reducing the financing gap through digital channels.

IDB Invest will also provide advisory services to SURA Investments, the fund manager, through recommendations aligned with the Task Force on Climate-related Financial Disclosures (TCFD) to measure financial risks related to the climate change. Likewise, IDB Invest will provide advice on gender, diversity and inclusion to integrate gender considerations throughout the fund manager's investment process, from selection and origination to investment, and to develop a value proposition focused on closing the gender gap in pensions through Colombia’s pension fund (AFP, for its acronym in Spanish).

This agreement is expected to 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 Inter-American Development Bank 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 $16.3 billion in assets under management and 394 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.

About SURA Investments

SURA Investments is a leading investment platform in Latin America, which combines the expert advice of its more than 40 years of experience in the region with the strength of a team of more than 100 investment professionals. SURA Investments manages more than $18 billion in funds and investment mandates in Chile, Colombia, Mexico, Peru, Uruguay, Argentina, the United States and Luxembourg, and offers sophisticated investment products in the market, due to its experience in fixed income, stock markets, real estate, private debt and infrastructure. In line with its purpose of contributing to the sustainable development of Latin America, SURA Investments has a strong commitment to incorporating environmental, social and governance criteria as an integral part of its investment process. SURA Investments is a subsidiary of SURA Asset Management, the leading Asset Manager in Latin America in pension fund administration, asset management and investment consulting, with more than $140 billion of assets under management, more than 23 million clients and 7,100 employees.