El Salvador will upgrade its municipal markets operations with a $10 million loan from the Inter-American Development Bank’s Opportunities for the Majority initiative, coupled with an additional loan of up to $10 million to be syndicated to international lenders.
The funds will finance the construction and remodeling of physical, technological, functional, and business and administrative management infrastructure, raising the competitiveness and incomes of microentrepreneurs as well as their sanitary and working conditions, and contributing to the development of local economies.
Most of the beneficiaries will be women heads of low-income households who sell food, fruits and vegetables, clothing and crafts in the municipal markets.
The resources will be delivered to the Federation of Savings and Loan Associations and Workers’ Banks (Fedecrédito), a prestigious organization set up nearly 70 years ago. Fedecrédito will channel the funds to its member institutions —48 savings and loan associations and seven workers’ banks— which will in turn channel them through 115 branches around the country to the municipalities that operate the markets.
The IDB's Opportunities for the Majority Initiative promotes market-based, sustainable business approaches that engage private firms, local governments and communities to deliver quality products and services to improve the living standards of low-income people.
The IDB loan is for a seven-year term, with a one-year grace period, at a Libor-based interest rate.