IFC and ADOPEM support 140,000 new loans for micro-entrepreneurs in the Dominican Republic
Santo Domingo.- IFC, a member of the World Bank Group,announced today a RD$450 million (approximately US$10 million) loan for Bancode Ahorro y Crédito ADOPEM S.A. to boost lending to entrepreneurs. IFC’s supportwill allow ADOPEM to issue an additional 140,000 microloans over the next sevenyears, a 70 percent increase from June 2015. About two-thirds of those loansare expected to go to women, enabling them to expand and diversify theirenterprises.
Access to credit playsa critical role in spurring economic growth and reducing income inequality.Although the Dominican Republic has successful microfinance institutions thereis still a significant gap in lending; only about 15 percent ofmicro-entrepreneurs in the country have access to credit.
“We have made greatstrides in serving our community. Almost 70 percent of our clients have accessto financing exclusively through Banco ADOPEM and the bank’s average loan sizeof US$480 is the lowest among Dominican microfinance institutions,” saidMercedes Canalda de Beras-Goico, Banco ADOPEM’s Executive President. “But thereis more to be done and we are glad to be taking on new challenges with IFC’scontinued support.”
IFC was the firstinternational investor in Banco ADOPEM, after it became a regulated bank. As ashareholder from 2007 to 2015, IFC provided a total of US$1.2 million, whichresulted approximately 60,000 loans for Dominican entrepreneurs over the courseof eight years. Since IFC’s original engagement, ADOPEM’s loan portfolio andcustomer base have almost quadrupled, while maintaining excellent assetquality.
“ADOPEM’s success isreflected in the thousands of women and men who have created a path out ofpoverty. Their small businesses have a big impact on their families and theircommunities,” said Luc Grillet, IFC Senior Manager for the Caribbean andCentral America. “ADOPEM has been a key partner for IFC. Together we arecommitted to increasing access to credit for entrepreneurs who are working hardto build their businesses.”
IFC and FundaciónMicrofinanzas BBVA, ADOPEM’s largest shareholder, have been working togethersince 2008 to boost social and economic development in Latin America throughmicrofinance. This loan to Banco ADOPEM is an opportunity for IFC toconsolidate a relationship with Fundación Microfinanzas BBVA that has spannedmany years, not only in the Dominican Republic but also in other Latin Americancountries such as Peru and Colombia where both institutions have also partnered.
IFC’s loan to ADOPEM isconsistent with IFC’s strategy in the Dominican Republic, which focuses onsupporting economic growth and ensuring opportunities for poorer segments ofsociety. At the end of June 2015, IFC had a committed investment portfolio in theDominican Republic totaling $198 million, including $22 million from partneringinstitutions. IFC’s clients in theDominican Republic last year supported more than 14,000 jobs.