CAF Approves $10 Million Line of Credit to Strengthen the Productive Development Bank of Bolivia

In an effort to increase the allocation of financial resources that seek to strengthen the country’s microcredit programs and support the growth of small and medium-sized enterprises (SMEs), CAF - Development Bank of Latin America has approved a line of credit of up to $10 million for the Productive Development Bank (BDP) of Bolivia, whose purpose is to fund local development and productive innovation projects.

To that end, CAF representative in Bolivia Gladis Genua and BDP President Marcelo Montenegro signed an agreement outlining the conditions for this operation, which aims to make the entity stronger. The line of credit - which will be used to provide loans to BDP clients and guarantors - will be revolving and uncommitted.

The Productive Development Bank of Bolivia is a mixed ownership first- and second-tier financial intermediation corporation dedicated to the promotion and funding of the country’s growth in terms of production while reducing risk, which enables it to provide credit directly to micro, small- and medium-sized business initiatives on preferential terms. While CAF owns as much as 20 percent of BDP’s shares, the remaining 80 belong to the state of Bolivia.

"It is important for CAF to bolster SMEs and micro-enterprises, as they often encounter obstacles when seeking financing due to a lack of guarantors,” Genua said. “We want them to be able to raise funds that allow them to increase their productivity, create jobs, produce goods and services, and contribute to the growth of the economy and the overall development of the country.”

The BDP, through its credits financially supports a host of sectors, including tourism, manufacturing, agriculture, fishing and aquaculture, providing them with the seed capital they need for their productive ventures, as well as women's initiatives and leasing for machinery.

Micro, small- and medium-sized enterprises account for 99 percent of the global business fabric and are the main source of employment and wealth for countries, Genua added.