La Paz-based microfinance lender BancoSol raised 150 million bolivianos ($21.9 million) for its second gender bond issuance, securing backing from the national social security agency, Bolivian asset manager Sociedad Administradora de Fondos de Inversión, and a number of regional investors.
The bond is part of BancoSol’s Avanza Mujer program, which provides the country’s female entrepreneurs with flexible loans, training and digital business tools. It will provide flexible, long-term loans to 3,200 women-led businesses.
The bond secured a AA1-rating from Bolivia’s AESA Ratings – without any concessional financing or de-risking mechanisms
BancoSol’s first gender bond issuance last year – the country’s first social bond – was backed by a 50% guarantee from IDB Invest and closed in eight months. The demand gave BancoSol the confidence to return to the market for a second bond “without a guarantee – just BancoSol on its own,” BancoSol’s Veronica Gavilanes told ImpactAlpha.
“Despite the challenging economic context in Bolivia, a long-term, sustainability-focused approach to empowering women must continue,” she said.
Women’s empowerment
Small businesses are the biggest driver of jobs in Bolivia; about 70% of all micro and small businesses in the country are run by women. Access to traditional financing streams remains a challenge.
BancoSol’s first bond supported 4,500 women-led enterprises. A survey of borrowers found that about 85% had increased their income generation. Nearly 90% of entrepreneurs financed felt greater influence in their households and communities and three-quarters reported more autonomy in making financial decisions, and 85% increased their capacity to generate income.
“We are intentionally working to close gender gaps in our loan portfolio and promote growth for women-led businesses,” said Gavilanes.
BancoSol’s strategy involves reaching women and other underbanked groups through e-banking, mobile branches and setting up mini-agencies.
“Our aim is to keep closing financing gaps in our portfolio, and possibly issue more bonds,” said Gavilanes.
Looking ahead, she added, BancoSol’s is also looking to develop more climate finance instruments.
