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Finanzauto Financial Inclusion

Project number 12202-01
Country Colombia
Sector Financial Institutions
Status In implementation

Basic information

Company name
Finanzauto S.A.
E&S category
FI-3
Disclosed date
Projected board date
Approval date
Signed date
Team Leader
Acuna Cubillos, Piedad Lucia

Financial Summary

Syndicated Amount $ 25,000,000
Financing Currency
COP

CLIENT
INFORMATION

Name: Santiago Cleves Bayón
Title: Planning Director
Telephone: 571 7499000 ext 530
email address: santiago.cleves@finanzauto.com.co

PROJECT
SCOPE
AND
OBJECTIVE

The financing consists of: (i) an A loan from the Inter-American Development Bank (IDB) for the COP equivalent of up to US$10 million; and (ii) a B loan from the IDB in the COP equivalent of approximately US$20 million. A term of up to five years is expected for the A loan, with no grace period. The term of the B loan(s) will be defined based on market conditions. With financing, Finanzauto S.A. will be able to offer loans to micro-, small-, and medium-sized enterprises (MSMEs) in Colombia’s transportation sector and various economic sectors that purchase vehicles as part of their productive assets for the development of their economic activity.

Finanzauto is an unregulated Colombian financial institution with more than 40 years in the market that focuses on passenger and commercial vehicle financing. It has 33,000 clients and conducts 15,000 transactions per year. It is the main unregulated vehicle financing institution in the country. Finanzauto has 150 points of service in the country in six cities and has formed partnerships with close to 240 car dealers through which it provides financing. As of June 2017, it had 380 employees. As of the same date, it had equity of US$119 million and assets of US$280 million.

Scope
of
the
Environment
review

1. General information and overview of the scope of the IIC Environmental and Social Review
The Inter-American Investment Corporation (IIC) assessed Finanzauto’s ability to manage the environmental and social risks of its portfolio, which will be financed with IIC funds.
 
2. Environmental and social classification and rationale
The subprojects to be financed through this operation have low risk potential. Thus, according to the IIC’s Environmental and Social Sustainability Policy, this operation has been classified as an FI-3 operation. The loans will average between US$10,000 and US$15,000.

3. Environmental and social risks and impacts
The principal environmental and social risks of this operation are related to Finanzauto’s ability to identify and manage the environmental and social risks associated with its loan activities. Finanzauto does not currently have an environmental and social management system for identifying and managing its portfolio’s environmental and social risk. Thus, it will have to develop a system that includes environmental and social procedures as well as assign staff trained to manage the environmental and social risks and impacts of its operations.

4. Mitigation measures
Finanzauto must ensure that all loans financed with IIC funds comply with the IIC List of Excluded Activities and with applicable local environmental and social standards. To better understand IIC requirements, staff responsible for implementing Finanzauto’s environmental and social management system must take the virtual course on environmental and social risk management offered by the IIC.

For project inquiries, including environmental and social questions related to an IDB Invest transaction please contact the client (see Investment Summary tab), or IDB Invest using the email requestinformation@idbinvest.org. As a last resort, affected communities have access to the IDB Invest Independent Consultation and Investigation Mechanism by writing to mecanismo@iadb.org or MICI@iadb.org, or calling +1(202) 623-3952.

For inquiries, comments and requests about the project

For inquiries, comments and requests about the project

Information Request