Proparco and Banco Rio join forces to promote the social inclusion of women and tackle territorial inequalities in Paraguay

Paraguay is a country with strong socio-economic and geographic disparities, ranked 77th most unequal country in 2020 according to the World Bank, particularly in terms of gender: only 38% of women have a current account, and 21% of SMEs created were by women.

Banco Rio is a Paraguayan bank, created in 2019 from the merger between Banco Itapuá and Financiera Rio. Banco Itapua's historical presence in the eastern and landlocked regions of the country, through 21 branches, and Financiera Rio's commercial engineering in favor of SMEs, make Banco Rio a key player in small business financing. The bank also offers digital and mobile services to its customers, enhancing financial inclusion in the country.

Proparco's $20 million loan will support Banco Rio in the development of its sustainable finance strategy, which aims to allocate half of all financing to SMEs in regions where the poverty rate is higher than the national average, notably Caaguazú and Misiones. The aim is to reduce regional disparities by supporting economic and social initiatives in often marginalized areas of the country. The other half of Proparco's financing is aimed at empowering Paraguayan women, by lending to SMEs founded or managed by women, according to the criteria of the “2X Challenge” initiative. Proparco will also support Banco Rio through a technical assistance offer dedicated to carrying out a diagnosis of its portfolio, developing products dedicated to women entrepreneurs, and improving their environmental and social (E&S) management system.

“Proparco is delighted with this new partnership with Banco Rio, a major player in the Paraguayan banking sector. We are particularly proud that Proparco is the first development finance institution to finance the bank. Our commitment is in line with our 2023-2027 strategy, which aims to reduce inequalities, but also with our shared desire to contribute to inclusive economic growth in Paraguay, with a priority focus on women and SMEs located in landlocked regions,” said Jean-Baptiste Sabatié, Deputy Managing Director of Proparco.

“This agreement with Proparco represents an important step in our mission to promote social and economic inclusion in Paraguay, particularly in sectors where opportunities are still limited. We firmly believe in the transformative potential of SMEs and the fundamental role played by women in the country's economic development. By allocating resources to the most disadvantaged regions and to Paraguayan women entrepreneurs, we are taking an important step towards reducing socio-economic and territorial disparities, and towards building a more equitable and prosperous future for all Paraguayans”, said Mr. Oscar Diesel, President of Banco Rio.