Leaders from Caja Huancayo accept award at the Global SME Finance Awards.
In an exciting announcement, Peruvian bank and Palladium partner Caja Huancayo, has been named Global SME Financier of the Year at the Global SME Finance Awards.
In Peru, Palladium manages USAID CATALYZE, a pay for results program that increases access to finance for small businesses by helping financial institutions minimise the risk of lending. For these financiers, this means lending to smaller, often unbanked, businesses while growing their portfolios in underserved regions in the Amazon. CATALYZE Peru has signed agreements with 10 financial institutions, which have collectively committed to mobilise US$24.1 million to the Amazonia region.
Among those financial intermediaries is Caja Huancayo, one of the first financial institutions to join CATALYZE Peru’s pay for results program. CATALYZE is working with this institution to mobilise US$2.9 million across eight regions in Amazonia, including the Junín region.
The Junin region, which partially sits in the central Peruvian jungle and is part of the Apurímac, Ene, and Mantaro River Valley, one of the most conflict-ridden and undeveloped areas of the country, with high poverty rates and poor infrastructure and communication services. The main economic activity is agriculture, with crops such as cocoa, coffee, pineapple, oranges, and coca leaves — most of which are used for illegal purposes.
“Because of the informal and unlawful activities in some cases, the Amazon can be somewhat risky for investments and financing,” explained Caja Huancayo’s Chairman of the Board, Jorge Solís Espinoza. “However, we are now investing in this region with clients who work to improve the economy every day, and we are seeing positive results.”
And they’re not far off their goal. So far, Caja Huancayo has mobilised US$2.7 million in capital for small businesses across the region like local stores or independently run businesses that offer financial services in areas where the banking operations are limited.
“The SMEs in the Amazon region require special attention that traditional banking institutions are not offering in a suitable manner,” explains Palladium Innovative Finance Specialist Sebastion Bazo. “In this respect financial intermediaries like Caja Huancayo developed tools and strategies to facilitate financial services for these market segments. Therefore, many families and communities are now benefiting by getting access to credit which allows the economic and social growth of the Peruvian Amazon.”
The award, which was announced at the annual Global SME Finance Forum in Phnom Penh, Cambodia, honours organisations that serve or finance SMEs in innovative and effective ways around the world.
Palladium Innovative Finance Director Luis Garate notes how important the award is not just for Caja Huancayo but for the sector as a whole and for other institutions considering providing credit for such a critical part of our global economies. “This prize represents for Caja Huancayo a great opportunity to enhance its global reputation and consolidates its position as a leading provider of financial services to the SME sector in Latin America and the Caribbean.”
Read about how CATALYZE is supporting SMEs around the world or contact firstname.lastname@example.org for more information.