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Mar 9, 2016 7:00 EST

IFC Boosts Financial Access for SMEs in Colombia with New Loan to Banco Pichincha

iCrowdNewswire - Mar 9, 2016

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Bogotá,  Colombia — IFC, a member of the World Bank Group,
strengthened  its  support to Colombia’s small and medium sized enterprises
(SMEs)  with  a  new  US$80  million  loan  to Banco Pichincha, a bank that
strives  to  sharply  boost  its  lending  to Colombian SMEs and low-income
students.

IFC’s  loan,  which  consists of US$50 million from its own account and $30
million  to  be  mobilized by IFC from other investors, will also reinforce
Banco  Pichincha’s  role  as  a  private-sector  leader in student loans in
Colombia.  IFC’s loan is expected to help Banco Pichincha nearly triple its
loans to SMEs by 2019 and also increase its portfolio of tertiary education
loans.

“IFC’s  support to our institution will help us continue to expand our work
with  SMEs  and  ensure  that  they  are able to access financing for their
operations  and growth in Colombia,” said Eduardo Fernández-Salvador, Banco
Pichincha’s  chief  executive  officer.  “This  loan  will also bolster our
education lending for lower to middle income students, which creates a path
for  social  mobility  and can open doors to better, more stable and higher
paying jobs,” he said.

For  IFC,  the  loan  to  Banco  Pichincha  is part of its efforts to boost
financial  inclusion in Colombia. Recent data suggests that only 53 percent
of  SMEs  in  Colombia  have  an  outstanding loan or line of credit with a
financial  institution, compared to 79 percent in Chile. Boosting financial
access  for SMEs is crucial to the country’s sustainable growth as they are
key driver of economic activity and job creation.

The  loan will also help boost access to tertiary education in Colombia, an
area  where  the  country has made great progress but where many challenges
remain.  Coverage  for tertiary education in Colombia remains significantly
lower  than  member countries of the Organization for Economic Co-operation
and  Development  (OECD), something which is partly attributable to lack of
financing options for potential students.

Pichincha  can  help  close  this  gap as it is a major player in providing
student  loans in Colombia. The bank maintains a relationship with over 480
tertiary  education  entities  in  32  cities  in  the Country and finances
approximately 94,000 students each year.

The  loan  is  part  of  wider  engagement by IFC with Grupo Pichincha, the
Ecuador-based  holding group that controls Banco Pichincha in Colombia, and
which also has operations in Peru, Panama, the United States and Spain. The
group  is  focused on increasing access to finance to low income households
and SMEs, making it a strategic partner for IFC in the Andean Region.

“Our long-term partnership with Pichincha helps to reach low-income sectors
of  the  population  and  to  create  a  more inclusive financial sector in
Colombia,”  said  Carlos  Leiria  Pinto, head of IFC for the Andean region.
“With  this  project,  IFC  reinforces  its compromise with the sustainable
economic  development  of Colombia and the use of our resources to increase
access to credit,” he said.

In  Colombia,  IFC is engaged in supporting sectors essential to social and
economic   development,   such   as   infrastructure,   health,  education,
agribusiness,  and  public-private  partnerships to build ports, roads, and
airports.  IFC also promotes access to finance for micro, small, and medium
enterprises,  and  works on improving the investment climate by simplifying
regulations and royalty management.

About IFC

IFC,  a  member  of the World Bank Group, is the largest global development
institution focused on the private sector in emerging markets. Working with
more  than  2,000  businesses worldwide, we use our capital, expertise, and
influence,  to  create  opportunity  where  it’s  needed most. In FY15, our
long-term  investments  in developing countries rose to nearly $18 billion,
helping  the  private sector play an essential role in the global effort to
end  extreme  poverty  and  boost  shared prosperity. For more information,
visit www.ifc.org

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Contact Information:

In Bogota, Colombia
Darcy Antonin Crowe, IFC
Phone: +57 1 313 6449
E-mail: [email protected]

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