The European Investment Bank will provide a EUR 200 million loan for micro-enterprises in Brazil
COVID-19 impacted companies, in particular female led businesses will benefit from this targeted support
The loan is part of the EIB’s response, in close cooperation with the EC, to the COVID-19 pandemic outside the EU
The support for female entrepreneurs was announced on International Women’s Day.
The European Investment Bank (EIB) has signed a EUR 200 million loan with Banco do Nordeste do Brasil (BNB), to support companies affected by COVID-19. The loan will help to address the working capital and investment needs of Brazilian micro-enterprises affected by the COVID-19 breakout, in the northeast, targeting the most vulnerable and very low income borrowers in the region.
BNB will finance private micro-enterprises affected by the COVID-19 breakout, providing short-term loans below EUR 1,000 via its Crediamigo Programme. Crediamigo offers loans to micro-entrepreneurs helping them to modernise and innovate, predominantly in urban areas, with a particular focus on finance for female-led businesses.
The EIB loan will help be instrumental in supporting gender equality and female entrepreneurship, whilst qualifying for the2X Challenge. The 2X Challenge is a leading initiative from the G7 Development Finance Institutions (DFIs), deploying and mobilizing capital to empower women and enhance their economic participation in emerging markets.
The proposed emergency financing is part of the policy and operational response of the EIB, in close cooperation with the European Commission (EC), to the COVID-19 epidemic breakout outside the EU. It is part of the EIB contribution to the Team Europe response to the COVID-19 crisis.
EIB Vice-President, Ricardo Mourinho Félix, responsible for Latin America said: “Financing for small businesses is one of EIB’s key priorities to stimulate private sector development, productivity and job creation during these challenging times.Therefore, we are pleased to join forces with BNB to help Brazilian micro-enterprises affected by the COVID-19 breakout to address their liquidity and investment needs, while contributing to promote gender equality by improving access to credit for businesses run by Brazilian women. As part of our Team Europe efforts, the EIB is committed to continue working to boost the inclusive reactivation of the economy in Brazil and across the Latin-American and Caribbean region”.
Romildo Rolim, President of the Banco do Nordeste do Brasil, said: “The partnership between Banco do Nordeste and the European Investment Bank is intended to further expand the Banco do Nordeste microcredit programme (Crediamigo), in particular in support of enterprises run by women entrepreneurs. In the context of the ongoing pandemic, Banco do Nordeste, as a driver of development in the region, has an important role to play in terms of undertaking actions to reduce negative impacts on the economy. In this regard, by joining forces and aligning their actions, BNB and EIB can help to create and execute more incisive strategies to promote the inclusion of women in the market, and provide them with access to credit. We are going to reinforce and further promote what is already a strong aspect of the Banco do Nordeste microcredit programme, namely its gender profile, with 66% of the current credit portfolio being held by women”.
EU Ambassador to Brazil, Ignacio Ybáñez, said: “Supporting Micro, Small and Medium Enterprises (MSMEs) as main drivers for job creation and economic growth, and strengthening the role of women are major objectives within the EU and its Member States and in the EU’s cooperation with partner countries. Within the current pandemic context, it is important to align efforts to assure a sustainable recovery of businesses, as well as reduce the implicit negative socio-economic consequences, especially for women, derived from a slowdown of economic activity. We are proud to confirm that we have supported the initiative from its inception phase, as this action forms part of the EIB’s External Lending Mandate that includes a guarantee by the EU. We applaud the conclusion of this agreement that, through “Crediamigo programme”, will give a boost to microbusiness mainly led by women in one of the poorest regions in Brazil, and represents a very good example of Team Europe efforts”
The Crediamigo programme is a market leading microcredit program in South America and covers 80% of the microcredit market in Brazil, according to central bank data. Currently, 66% of its client portfolio are female entrepreneurs. BNB partners with Instituto Nordeste Cidadania (INEC), who provides direct technical assistance to the final beneficiaries.
BNB also uses a group lending methodology based on the experience of Grameen Bank in Bangladesh (funded by Nobel Prize awarded Muhammad Yunus). Research shows how after 10 years of programme, extreme poverty has been reduced by 50% and household income rose by 60% among the beneficiaries.
The EIB in Latin America
The EIB, the Bank of the European Union, is the largest international financial institution in the world and approximately 10% of its lending and financing target is to the benefit of partners outside of the European Union.
The EIB provides economic support for projects in Latin America by facilitating long-term investment with favourable conditions and by providing the technical support needed to ensure that these projects deliver positive social, economic and environmental results. Since the EIB began operating in Latin America in 1993, it has provided total financing of EUR 10.4bn to support 139 projects in 14 countries in the region.
To enhance the positive impact of its activities on gender equality and empower women and girls, the EIB Group adopted a Strategy on Gender Equality and Women’s Economic Empowerment and a Gender Action Plan, with the aim of embedding gender equality and, in particular women’s economic empowerment in the EIB’s business model. It covers its lending, blending and advising work within and outside the EU.
Le groupe BEI a connu une activité très soutenue en 2022 en France, avec près de 10 milliards d’euros de financements à long terme accordés directement ou indirectement au secteur privé et aux collectivités territoriales : 8,4 milliards d’euros issus de la banque européenne d’investissement et 1,5 milliard du Fonds européen d’investissement (FEI) dédié au financement des PME.
EIB Global, the arm of the European Investment Bank (EIB) devoted to activities outside the European Union, has unlocked €76 million to further support the modernisation of Serbia’s education and sustainable transport infrastructure. This includes a €40 million loan to build, renovate and equip educational facilities across the country. Most of the investments will be made in regional training centres that offer upper secondary vocational training and education. These infrastructure improvements will provide modern learning conditions and improve the quality of education, while also increasing productivity and employability in the country.
The new operation being undertaken by BNL BNP Paribas and the EIB Group, which comprises the European Investment Bank (EIB) and the European Investment Fund (EIF), focuses on the real economy and is aimed at small and medium-sized businesses (with fewer than 250 employees), and mid-caps (companies with fewer than 3 000 employees). The Minerva 3 operation is technically a synthetic securitisation (with no asset assignment) on a portfolio of the bank’s performing loans.