US$25 million loan finances women-led SMES in Vietnam
The project is also co-financed by DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH (DEG) for $25 million.
The loan is accompanied by a $750,000 technical assistance grant to help TPB better meet the needs of WSMEs. The grant will be used to build TPB’s capacity to lend to WSMEs, hire staff, and promote its services to female borrowers. It will also enable TPB to use digital systems to analyze the underserved WSME market. The grant is funded by the Women Entrepreneurs Finance Initiative (We-Fi).
According to ADB, as of 2018, the majority of businesses in Viet Nam are classified as small and medium-sized enterprises, supporting 38 percent of the country’s employment and generating 40 percent of gross domestic product. But their access to finance is still a challenge, with only 37 percent of WSMEs able to obtain loans from banks, according to a 2017 study.
ADB’s Director General for Private Sector Operations Suzanne Gaboury said that ADB and its partners TPB and We-Fi are pleased to support WSMEs, which are important channels to increase women’s participation in Vietnam’s economic development. She added that Covid-19 has severely affected many businesses, and initiatives such as this loan and grant will support particularly underserved female borrowers by helping TPB develop systems and procedures to improve their access to finance.
We-Fi is a collaborative partnership among 14 governments, 8 multilateral development banks, and other public and private sector stakeholders, hosted by the World Bank Group.