Banco Solidario

Subsidy : April 2023

BIO has granted USD 16,143 of technical assistance to Banco Solidario, a microfinance institution in Ecuador

Amount

$ 16,143.00

Type of investment

Subsidy

Beneficiary locations

Latin America and Caribbean: Ecuador

Investment field

Financial Institutions

Activity

KK.64.191  Microfinance institution

Organisation

Banco Solidario

Domicile

Ecuador

More investments in

Banco Solidario

  • Debt $ 20,000,000.00 (2023)
  • Subsidy € 15,719.00 (2021-2022)
  • Subsidy € 12,290.60 (2019-2020)
  • Debt € 8,338,200.00 (2019)
  • Subsidy € 77,220.00 (2012-2014)
  • Debt € 5,987,000.00 (2012-2016)

Banco Solidario started its activities in 1996 with a social mission which focuses on the microfinance segment and vulnerable populations.

Banco Solidario (BS) is one of the leading microfinance players in Ecuador: 48% of its total portfolio is lent to microenterprises for productive purpose (105,881 microloans outstanding with an average loan amount of USD 3.1k). The rest (52%) are inclusive loan products targeting entrepreneurs and low-income populations. BS additionally provides a range of savings products, micro-insurance, traditional and digital payment & transfer facilities, financial education and business development trainings with the aim to improve financial inclusion.

The company is registered as a universal bank under the supervision of the Superintendence of Banks (SB).

Technical assistance

The objective of the Program is to update Banco Popular’s Social Rating and Client Protection Certification (CPC), and to perform an Impact Evaluation focused on the Bank’s microcredit client segment.

  • A Client Protection certification is an independent and objective evaluation of the extent to which a financial service provider is implementing the policies and operational practices considered necessary to protect its clients from harm. More info here.
  • A Social Rating is an expert opinion on the social performance of a financial institution, and the likelihood that it meets social goals in line with accepted social values. More info here.

Expected impact

The TA will allow the MFI to assess its progress against its own Environmental and Social agenda and its level of compliance with the Client Protection Principles of responsible financial inclusion (consensually recognised minimum standards that clients should expect to receive when doing business with a financial service provider); to understand eventual areas of improvement with respect to its social performance, contribution to the SDGs, and alignment with ESG best practices and finally, to showcase its achievements.

In 2021, Banco Solidario achieved a Gold CPC and Social Rating score of A+. The aim of the MFI is to re-validate the Social Rating score achieved under the previous assessment, and to improve in the areas identified as of lower performance of the latter. The impact study will allow the MFI to identify the positive impact on the lives of its clients that are attributable to its activities, in line with its theory of change and the SDGs.

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