Fondo de Desarrollo Local

Debt : October 2013 - October 2017

Fondo de Desarrollo Local is a regulated microfinance institution operating in Nicaragua, mainly offering loans to micro and small enterprises.

Amount

€ 3,031,680.00

Type of investment

Debt

Development impacts

Local economic growth
Financial inclusion
Food security & rural development

Beneficiary locations

Latin America and Caribbean: Nicaragua

Investment field

Financial Institutions

Activity

Microfinance Institution

Organisation

Fondo de Desarrollo Local

Website

https://www.fdl.com.ni/

Domicile

Nicaragua

More investments in

Fondo de Desarrollo Local

Subsidy $ 35,485.00 (2023-2024)
Debt € 3,674,000.00 (2017-2021)
Debt € 2,000,000.00 (2021-2024)

FDL started operations in 1997, in which it started operating as a program of the UCA´s (Centro-American University) Research & Development Institute NITLAPAN.

FDL is a nonprofit institution with a good track record and strong social mission and rural focus. FDL has become a leader in the MFI sector. Its main competitive advantages are a clear customer intimacy strategy, competitive pricing, social commitment and their excellent knowledge of the rural and agricultural market that has been essential for the design of products and services according to customer’s needs. In addition FDL has the support of the NITLAPAN institute to the Central American University that is specialized in the research and implementation of programs focused in the development of the rural sector. Its main areas of study are poverty, microfinance, agriculture, SMEs development and environmental care.

FDL is preparing to transform into Financiera, in order to be able to offer deposit products to the clients and as a result of this diversify the sources of funding. In 2011 the BoD approved to initiate the process for the transformation; since then FDL has been preparing and entering into a self-regulation process aiming to progressively adapt to the banking regulator´s norms and regulations.

BIO’s financing would support Fondo de Desarrollo Local (“FDL”) in further growing its loan portfolio and increasing its capacity to provide financing to micro-entrepreneurs in Nicaragua, a LMIC priority country.

Development impacts

Local economic growth
To stimulate the growth of FDL's loan portfolio and increasing its capacity to provide financing to micro-entrepreneurs in Nicaragua (the average loan size is USD 977)
Financial inclusion
FDL offers high quality services and products tailored to customer needs. The MFI has developed a niche strategy in the rural sector where it is well positioned and where it has a deep outreach.
Food security & rural development
FDL is leader in the rural sector where there is a large unmet demand for rural credit facilities due to the lack of interest of main banks on this sectors, owing to the higher operating cost involved.

Outreach in rural zones and the vast majority of the loan portfolio is focused on the agricultural sector (50,9%) and commerce (36,6%).