IFC Plans $250M Investment to Expand SME Finance and Climate-Resilient Growth in Peru

Officials say the initiative reflects a broader effort to mobilise private capital toward sustainable and inclusive growth sectors in Latin America’s fourth-largest economy.

The International Finance Corporation (IFC), the private sector arm of the World Bank Group, has announced a proposed US$250 million sustainable subordinated debt investment in Banco de Crédito del Perú (BCP), in a major push to expand financing for small businesses, women entrepreneurs, green construction, and climate-resilient agriculture across Peru.

The investment is designed to strengthen access to long-term sustainable finance in sectors considered critical to Peru's economic development while helping the country address growing climate-related risks and structural barriers to financial inclusion.

Officials say the initiative reflects a broader effort to mobilise private capital toward sustainable and inclusive growth sectors in Latin America's fourth-largest economy.

Investment Targets SMEs, Women Entrepreneurs and Climate Resilience

Under the proposal, IFC's financing will help BCP expand lending to small and medium enterprises (SMEs), with a particular focus on women-owned and women-led businesses that continue to face significant barriers to accessing credit.

The programme will also support:

• Sustainable and energy-efficient construction

• Green-certified buildings

• Climate-resilient agricultural projects

• Water and energy efficiency initiatives

• Rural adaptation to climate shocks

The sectors targeted under the investment are viewed as essential drivers of employment, productivity, and long-term economic resilience in Peru.

Peru Facing Financial Inclusion and Climate Challenges

The investment comes as Peru continues grappling with multiple structural economic challenges, including:

• High levels of labour informality

• Limited access to long-term financing for SMEs

• Unequal access to credit for women entrepreneurs

• Climate-related disruptions affecting agriculture and housing

Extreme weather events, including floods, droughts, and changing climate patterns, have increasingly exposed vulnerabilities across Peru's agricultural sector and infrastructure systems.

At the same time, many smaller businesses continue struggling to secure affordable financing needed for expansion, productivity improvements, and formalisation.

IFC says strengthening the financial sector's ability to scale sustainable lending will be critical to unlocking private investment and supporting more resilient economic growth.

BCP Says Deal Strengthens Sustainability Strategy

BCP Chief Executive Officer Diego Cavero said the proposed transaction would help deepen the bank's sustainability agenda while supporting sectors fundamental to Peru's economic future.

"This transaction will allow us to further consolidate our sustainability strategy by supporting projects that generate economic value while also delivering positive social and environmental impact," Cavero said.

He added that the initiative would place "particular emphasis on key sectors that are fundamental to job creation and Peru's development."

Banco de Crédito del Perú is the country's largest bank and one of the most influential financial institutions in the Andean region.

IFC Emphasises Sustainable Finance as Economic Growth Driver

Elizabeth Martinez de Marcano, IFC Regional Director for Latin America and the Caribbean, said sustainable finance is increasingly central to job creation and long-term economic resilience.

"Access to sustainable finance is essential for creating jobs," Martinez de Marcano said.

"By supporting BCP to expand lending for SMEs, green buildings, and climate-resilient agriculture, IFC is helping mobilize private capital toward sectors that deliver long-term impact for people and the economy."

The investment aligns with IFC's broader strategy of using private sector financing to support climate adaptation, gender inclusion, and sustainable development across emerging markets.

Women Entrepreneurs Among Key Beneficiaries

A major component of the initiative focuses on improving access to credit for women entrepreneurs, who often face disproportionate financial barriers despite playing a critical role in economic activity and job creation.

Research across Latin America has consistently shown that women-owned businesses frequently encounter:

• Higher collateral requirements

• Lower approval rates

• Smaller loan sizes

• Limited access to formal banking products

IFC says expanding financing opportunities for women-led SMEs can help boost economic participation, improve productivity, and strengthen inclusive growth outcomes.

Green Building Finance to Support Sustainable Urban Growth

The project will also expand financing for energy-efficient and water-efficient buildings certified under internationally recognised green standards.

Officials say sustainable construction finance can help Peru:

• Reduce building-related emissions

• Lower household operating costs

• Improve urban resilience

• Address housing shortages more sustainably

Green construction is increasingly becoming a major focus for development finance institutions as cities across emerging economies face rapid urbanisation pressures alongside climate commitments.

Climate-Resilient Agriculture Funding to Support Rural Communities

Another significant component of the programme involves expanding financing for climate-resilient agriculture.

Peru's agricultural sector has become increasingly vulnerable to:

• Droughts

• Flooding

• Extreme weather events

• Water scarcity

• Soil degradation

The initiative aims to help rural producers adopt more resilient farming practices while improving productivity and long-term sustainability.

Development experts say climate adaptation financing remains critically underfunded across Latin America despite agriculture being one of the sectors most exposed to climate change impacts.

IFC to Provide Advisory and Technical Support

In addition to financing, IFC will provide advisory services and technical assistance to support implementation of sustainable lending products and environmental standards.

The support will include:

• Development of green construction finance products

• Strengthening green building certification adoption

• Promoting resilient agricultural practices

• Capacity building within the financial sector

IFC says combining long-term financing with technical expertise is intended to create demonstration effects that encourage other Peruvian financial institutions to expand sustainable and inclusive lending models.

UK-Backed Green Construction Programme Supporting Investment

The investment is also supported through IFC's Market Accelerator for Green Construction (MAGC), a blended finance initiative backed by the United Kingdom's Department for Energy Security and Net Zero.

MAGC is designed to scale green construction lending across emerging markets by incentivising financial institutions to develop and expand sustainable construction finance products.

Blended finance programmes like MAGC increasingly play a key role in reducing investment risks and accelerating private capital mobilisation for climate-related infrastructure and sustainable development projects.

Sustainable Finance Becoming Central to Latin America's Growth Strategy

The proposed investment reflects a broader regional shift toward sustainable finance as governments, banks, and development institutions seek to align economic growth with climate adaptation and social inclusion goals.

Latin America is increasingly viewed as a critical region for climate-resilient investment due to its exposure to environmental risks alongside its large renewable energy potential and growing urban populations.

IFC and other development finance institutions argue that mobilising private sector capital into sustainable sectors will be essential for emerging economies seeking to balance economic development with climate resilience and long-term social stability.