FONPLATA grants a credit of USD 36 million to the National Development Bank (BNF) of Paraguay for post-pandemic economic reactivation
FONPLATA – Development Bank has granted a USD 36 million revolving loan facility with an eight-year repayment term to the Banco Nacional de Fomento (BNF, National Development Bank), an important government agency present nationwide. The loan will be used for funding small and medium enterprises that are part of the export value chain.
This operation to the non-sovereign state-owned sector will enable FONPLATA to increase the amount of resources available to contribute to the improvement of the quality of life of the people of Paraguay, as well as to generate social, economic, and environmentally sustainable development. It aims at meeting the demand of BNF for financial resources to grant loans to at least 300 small and medium enterprises operating in the production, industry and service value chains linked to export. These loans are meant to be invested in works, goods, and services.
Created in 1961, the BNF is a government agency regulated by the Central Bank of Paraguay (BCP) with strong presence in the local market. Its purpose is to promote the country’s social and economic development by providing financial services and giving priority to strategic and inclusive development projects. Since the alteration of its Charter in 2017, the BNF has facilitated loan access to consumers, crops production and agribusiness, housing, and manufacturing. As a consequence, the composition of its client portfolio has significantly increased. In fact, the institution has already disbursed USD 118.6 million (up to the beginning of September 2020) in loans related to the COVID-19 health emergency, reaching more than five thousand people.
It is the first time that the Paraguayan BNF executes this type of operation with a multilateral development bank. Prior to this, the Bank has managed lines of credit with local agencies, such as the Agencia Financiera para el Desarrollo (AFD, Development Finance Agency). At the same time, this is the second operation in the history of FONPLATA aimed at funding the non-sovereign state-owned sector, which continues paving the way to similar projects already identified in the other member countries.