Post by jakir12 on Feb 15, 2024 8:40:06 GMT
While public development banks (PDBs) today offer a variety of programs to improve access to credit for women, investments that go beyond financial capital are needed to address the unique needs of women and their businesses and drive a more inclusive financial sector, according to a new global survey carried out by the Inter-American Development Bank (IDB) and UN Women. The new report, “Financing Programs for Women's Financial Inclusion and Access to Finance for Women's MSMEs: Results from a Survey of Public Development Banks ,” (English only) presented during the Common Finance Summ which takes place from September 4 to 6 in Cartagena, Colombia, reveals advances, opportunities and challenges in the offer of financing programs for women and their companies. The survey, completed by 54 BPD, indicates that banks have come a long way in offering programs for women's micro, small and medium enterprises (MSMEs), which focus on productive financing, business development, financing green and climate, and financial education. 91% of BPDs surveyed also include products designed for women as part of their women's MSME programs, predominantly offering working capital and investment loans with lower interest rates and non-financial support.
Data shows that PDBs, with the leadership of multilateral development banks, are addressing gender biases, and that multilateral development banks are also driving the design of data-driven, gender-responsive products, as well as new instruments such as gender bonuses. PDBs that have a national mandate (national development banks) predominantly offer preferential product features for MSMEs, including lower interest rates, flexible repayment terms and collateral-free loans, while other PDBs, including subnational development banks , they resort to financing methods to facilitate cash flow. However, the survey also concludes that there is still a way Slovenia Email List to go to expand access to finance for women and their businesses, as well as to improve women's financial inclusion. At this point, the report points to the lack of sex-disaggregated data and limited understanding of the financial needs of women's MSMEs as the main challenges. Likewise, the survey highlights that lack of collateral or guarantees and limited credit history present another barrier to expanding financing programs for women.
At the same time, a low percentage of institutions surveyed reported accepting non-traditional collateral and using alternative credit scoring mechanisms, suggesting an opportunity for BPDs to explore other innovations that mitigate collateral-related barriers for women's MSMEs. “PDBs play a key role in improving access to credit for MSMEs and act as catalysts for change towards a more inclusive financial sector. The report revealed that the sector is investing in programs to improve access to credit for women, but there is still a significant opportunity to expand these types of solutions both in terms of their reach and the types of programs offered for this important segment of the economies of our countries. Gabriela Andrade, leading specialist in the IDB's Connectivity, Markets and Finance Division. "The IDB is committed to continuing its support to BPDs in Latin America and the Caribbean in this important agenda, which includes financing and structuring programs, providing technical assistance and promoting the generation of knowledge," he added.
Data shows that PDBs, with the leadership of multilateral development banks, are addressing gender biases, and that multilateral development banks are also driving the design of data-driven, gender-responsive products, as well as new instruments such as gender bonuses. PDBs that have a national mandate (national development banks) predominantly offer preferential product features for MSMEs, including lower interest rates, flexible repayment terms and collateral-free loans, while other PDBs, including subnational development banks , they resort to financing methods to facilitate cash flow. However, the survey also concludes that there is still a way Slovenia Email List to go to expand access to finance for women and their businesses, as well as to improve women's financial inclusion. At this point, the report points to the lack of sex-disaggregated data and limited understanding of the financial needs of women's MSMEs as the main challenges. Likewise, the survey highlights that lack of collateral or guarantees and limited credit history present another barrier to expanding financing programs for women.
At the same time, a low percentage of institutions surveyed reported accepting non-traditional collateral and using alternative credit scoring mechanisms, suggesting an opportunity for BPDs to explore other innovations that mitigate collateral-related barriers for women's MSMEs. “PDBs play a key role in improving access to credit for MSMEs and act as catalysts for change towards a more inclusive financial sector. The report revealed that the sector is investing in programs to improve access to credit for women, but there is still a significant opportunity to expand these types of solutions both in terms of their reach and the types of programs offered for this important segment of the economies of our countries. Gabriela Andrade, leading specialist in the IDB's Connectivity, Markets and Finance Division. "The IDB is committed to continuing its support to BPDs in Latin America and the Caribbean in this important agenda, which includes financing and structuring programs, providing technical assistance and promoting the generation of knowledge," he added.