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International development

Helping micro and small businesses drive economic growth

February 2, 2023

Micro and small businesses are recognized as key drivers of socioeconomic development and job creation, but the ones operating in developing countries face major obstacles when it comes to accessing financing, especially when they reach the critical growth stage. Women and young business owners are more affected by limited access to funding.

From October 2014 to September 2022, with financial support from Global Affairs Canada, DID carried out a large-scale project to help thousands of businesses by giving them better access to the support and financial services they needed. An initiative which covered Benin, Colombia, Panama, Tanzania, Tunisia and Zambia.

Unprecedented reach and impact

"I started from scratch. And I'm here today because of the loans I got." Irene Ramírez, Colombia

This major project to support the growth of micro and small businesses has led to:

More economic growth and job creation:

  • 26,282 male entrepreneurs and 12,945 female entrepreneurs were supported
  • 109,800 jobs were created or retained in the communities

Increased access to financial services:

  • 12 entrepreneur financial centres (EFCs) and other inclusive finance institutions representing 30 points of service and 675 local employees (50% of whom are women) are now able to meet the needs of micro and small businesses
  • These financial institutions were able to grant over 72,000 loans to entrepreneurs, for a total amount of CAN$500 million

More impact:

  • For every dollar provided by the Canadian government for technical assistance, an additional $7.30 was contributed
  • Collaborations have been established with 6 major universities to develop and implement innovative initiatives focused on entrepreneurial development
  • Partnerships have been forged with some 30 government entities, entrepreneur support service providers and local organizations to carry out this project and multiply the benefits
  • The project has resulted in technological developments and innovations that will continue to make it easier for entrepreneurs to access financing and support in the coming years

Entrepreneur financial centres: Helping businesses grow

"Our industry sector was hard hit by the repeated lockdowns due to the COVID-19 crisis. That's why I went to the EFC. The support I got helped me improve my working capital and buy the equipment I needed to keep my business running." Ahlem Chérif, Tunisia

DID helped set up 7 entrepreneur financial centres (EFCs) in Tunisia, Zambia, Tanzania, Panama and Benin. These specialized financial institutions provide financing and support services that are adapted to the needs of people running micro, small and medium-sized enterprises (MSMEs). These institutions are deeply rooted in their respective communities and have quickly become leaders in their markets. They've made a huge difference for their clients.

"Thanks to the EFC, I just got my first ever loan! I was able to use it to buy a tractor to farm all my land. Before, the work was tiring and difficult, and I could only farm 12 hectares of the 34 that I own. With this loan, I was able to increase my income to support my entire family." Guerra Abou, Benin

Graduar PYMES project: Supporting growth and formalization

In Colombia, the Graduar PYMES project allowed DID to assist 5 local financial institutions in order to better serve MSMEs and support their growth and formalization. In 2020, Colombia's Banca de las Oportunidades program partnered with Global Affairs Canada to co-finance the Graduar PYMES project and expand its impact.

DID worked with the 5 participating institutions to implement new credit management methodologies, support services, inclusion mechanisms for women entrepreneurs, and mechanisms for analyzing social and environmental risks, as well as a digital transformation strategy and a hybrid learning program. 

"The Graduar PYMES project has helped us develop and understand how to serve the SME market in Colombia. We used DID's methodology to develop a tailored strategy, train our employees and help micro-entrepreneurs obtain financing that meets their needs." Diego Fernando Muñoz, Executive Vice-President of Banco Mundo Mujer, Colombia

Support is key

Entrepreneurs need financing, as well as support. This has been the major focus of our goal to support the growth of micro and small businesses. Our actions are based on a detailed analysis of entrepreneurs' needs and their daily challenges. We innovated using solutions that are focused on female leadership, formalization and business growth. And we made a real difference to the people we targeted.

"The Growth Path has made me more confident and more determined. Before, I was skeptical and almost stopped. But now, I have a vision and I'm no longer afraid. I take initiative instead of following trends. I have a strategy. My margins have improved, and I have 20% to 25% growth so far." Selma Fliss, Tunisia

"The female leadership program has strengthened my entrepreneurial skills and made me to believe in my ability to succeed and overcome obstacles." Jihen Haddar, Tunisia

"With the loan that I got, I was able to quickly speed up my business growth. But what made the difference was the support I received." Claudia Quiceno, Colombia