Montreal, June 16, 2021 - FinDev Canada announced a USD 10 million loan to Cooperativa de Ahorro y Crédito Pacífico (Cooperativa Pacifico,) Peru’s largest financial cooperative, as a way of providing more liquidity to the country’s small- and medium-sized enterprises (SMEs) hard-pressed by the COVID-19 pandemic. This new financial support will help recovery efforts for Peruvian SMEs, which will in turn favour job creation and enhance prosperity. At least 30% of the loan will be used to finance women-led/owned SMEs.
Founded as a savings and credit cooperative in 1970, Cooperativa Pacifico has expanded its network of 10 branches in and around the capital city of Lima. The Cooperative promotes economic and social development through financial products such as loans and non-financial services including scholarships, internships, and seminars on economic and commercial issues.
More than 99% of Peruvian companies are SMEs, employing over 89% of the private sector workforce. Despite their importance in the national economy, SMEs remain underbanked and struggle to secure financing. In addition, COVID-19 in Peru has caused lockdowns, supply chain disruptions, and a fall in consumer demand, resulting in a sudden, sharp drop in revenues and profitability for many SMEs, creating liquidity shortages and threatening the survival of many viable businesses.
“As part of our COVID response strategy, we are committed to supporting SMEs by providing capital through financial intermediaries,” said Paulo Martelli, Chief Investment Officer of FinDev Canada. “Cooperativa Pacifico has a strong track record of lending to SMEs. This loan will enable Cooperativa Pacifico to deliver much-needed financing to a critical sector of the Peruvian economy and help drive the recovery from the pandemic.”
“Our partnership with FinDev Canada gives us the opportunity to continue diversifying our financing with institutions that share our long-term commitment and mission towards sustainable development. We understand our responsibility and we have assumed an active role in the market, not only financing our members, but looking for articulate stakeholders through sustainability principles, listening and transmitting ideas and criteria from customers, suppliers, competence up to regulators in order to create a sustainable ecosystem. In particular, we will be able to increase our support to SMEs often facing obstacles to obtain financing,” said Armando Ouchida Noda, Chief Executive Officer of Cooperativa Pacifico.
Local economic development
The loan is destined for on-lending to SMEs in Peru. The USD 10 million is expected to finance operations at more than 140 SMEs, leading to the creation of more than 4,200 jobs, including more than 1,000 jobs for women. The enhanced liquidity is expected to allow the SMEs to maintain or expand operations, contributing to economic and social benefits in their communities.
Gender action
Cooperativa Pacifico has committed to channel 30% of FinDev Canada’s loan to women-led/owned enterprises enabling them to grow their businesses while supporting quality jobs for women.
The Cooperative also upholds women’s economic empowerment within its internal operations: 29% of its senior management team are women, as are 53% of its employees. Cooperativa Pacifico is also working on developing a gender equality strategy to help employees and customers overcome barriers to gender equality.
Through the Cooperative’s gender commitments, the transaction qualifies for the 2X Challenge – Financing for Women. Through this initiative, DFI’s, multilateral development banks, and private sector investors have committed more than USD 4.5 billion to advance women’s economic empowerment and gender equality in developing countries.
Development Finance Institutions and COVID-19
FinDev Canada has a mandate to support companies that have a presence in the areas most affected by the COVID-19 pandemic. Investments will help guarantee that developing markets continue to have liquidity, providing important support for the recovery from the economic and social consequences of this crisis.
About FinDev Canada
The Development Finance Institute Canada (DFIC) Inc., operating under the FinDev Canada brand, is a Canadian institution dedicated to providing financial services to the private sector in developing countries with the aim of combating poverty through economic growth by focusing on three main topics: economic development through job creation, women’s economic empowerment, and climate change mitigation. The Development Finance Institute Canada Inc. is a wholly owned subsidiary of Export Development Canada (EDC).
About Cooperativa Pacifico
Cooperativa de Ahorro y Crédito Pacífico was founded in 1970 by members of the Japanese community in Peru, with the aim of being the best alternative for savings and credit. With 50 years of experience and more than 50,000 active members, Cooperativa Pacífico is positioned as the first Cooperative on a national level and number 9 in Latin America, according to the DGRV ranking. Cooperativa Pacífico is dedicated to accompanying its partners in achieving their dreams and projects of a personal and business nature seeking to provide innovative services with high social and environmental sense.
About the 2X Challenge
The 2X Challenge was launched in June 2018 as a major new commitment of the development finance institutions (DFIs) from the G7 countries to unlock resources that will help advance women’s economic empowerment and gender equality. These DFIs have since been supporting investments and initiatives that provide women in developing countries with access to leadership opportunities, quality employment, financing, enterprise support, as well as products and services that enhance the inclusion or economic participation of women and girls. Since the launch, additional DFI and MDB members have joined to expand the commitment.