More than 750,000 low-income families in Mexico, Colombia, Costa Rica, Nicaragua and the Dominican Republic to benefit from the project
Patrimonio Hoy, the housing microfinance program of CEMEX, will expand lending to low-income families in Mexico and four other Latin American countries with a partial credit guarantee of up to $10 million from the Inter-American Development Bank (IDB). As many as 750,000 families over the next five years are expected to benefit from this project.
Patrimonio Hoy is one of Latin America’s most successful social enterprises, providing low-income families earning less than four times the minimum wage in Mexico with access to microloans for construction materials and labor as well as technical assistance for the purpose of building or renovating their homes.
The IDB guarantee will allow the company to expand its offering of credit products that will, for example, allow them to pay for labor costs related to construction besides materials. The guarantee will also pave the way for the company to scale up its operations in Colombia, Costa Rica, Nicaragua and the Dominican Republic.
The partial credit guarantee was approved on June 22 and the signing agreement will occur during the BASE, the First Forum for the Development of the Base of the Pyramid, in São Paulo on June 28.
Patrimonio Hoy was created in 1998 to meet the rising need for housing microfinance among low-income families, which are at the base of the pyramid in Mexico. This segment of the population lack access to bank credit and government housing finance programs.
Through the program, CEMEX has supported more tan 300,000 low-income families with the provision of microloans to finance construction material purchases and technical assistance with the participation of distributors. The program has also created a network of promoters made up mostly of female entrepreneurs from the own communities, helping generate an important number of jobs.
The partial credit guarantee was provided by the IDB’s Opportunities for the Majority Initiative (OMJ). In 2008, the initiative approved a $10 million partial credit guarantee to support the expansion of CEMEX’s Mejora tu Calle, an urban infrastructure improvement program in partnership with local governments that provides microcredit for families to finance street paving and the construction of sidewalks.
Created three years ago, OMJ has invested more than $160 million to help develop novel base-of-the-pyramid business models to integrate the poor into the formal economy, improve their standards of living and promote greater social inclusion.
- Romina Tan Nicaretta