IFC, a member of the World Bank Group, will provide a USD10 million loan to Fundación Genesis Empresarial, Guatemala’s largest non-profit microfinance institution, to support micro and small business entrepreneurs who don’t have access to finance. Genesis serves more than 100,000 clients, nearly 90 percent of whom live in rural areas. IFC’s loan is expected to help Genesis reach an additional 120,000 underserved borrowers within five years. Most of these loans are expected to go to women and indigenous people in rural areas.
Guatemala is the largest economy in Central America, however its income distribution is one of the most unequal in the world. Poverty is widespread, especially in rural and indigenous areas. Microfinance institutions like Genesis play an important role in the economy by providing financial services to the country’s 790,000 microenterprises and small businesses, which generate about 85 percent of jobs and around a third of its gross domestic product. Despite their economic importance, most of these enterprises have little or no access to formal credit.