IDB Invest: $75M Boost for Women-Led Businesses in DR

IDB Invest, a member of the IDB Group, has launched a breakthrough project to close the gender gap in financial inclusion and increase women's economic empowerment in the Dominican Republic. Banco BHD will get a $75 million subordinated loan with an extension period of up to seven years to improve credit access for micro, small, and medium-sized companies (MSMEs) owned or headed by women, with a concentration on loans in Dominican pesos.

The Dominican Republic, which has around 1.5 million MSMEs, has a considerable gender discrepancy in financial inclusion, as indicated by a 22% lower loan reception rate for women compared to males in the previous year. These firms, which account for 98% of all Dominican businesses and employ 65% of the labour force, are critical to the country's economy.

Banco BHD, which has been recognized for its efforts to close gender inequalities in finance, will work with IDB Invest to adopt the WeFinance Code. This private-sector-led project uses gender-disaggregated data to improve assistance for women-led MSMEs inside the financial ecosystem.

The WeFinance Code, which is supported by the Women Entrepreneurs funding Initiative (We-Fi), aims to make funding available to female entrepreneurs. IDB Invest will provide technical assistance to Banco BHD on digitizing and exploiting data to adapt financial offers to businesswomen, including market studies for rural and urban entrepreneurs and tools to reduce unconscious bias in loan procedures.

This joint endeavor is consistent with the United Nations Sustainable Development Goals, with a focus on gender equality, economic development, innovation, and the reduction of disparities. The program aims to automate and grow Banco BHD's products for women-led MSMEs, encouraging information transfer across Dominican financial organizations and stakeholders.