This project proposes a new model to facilitate migrants’ access to affordable financial services, enabling them to contribute more significantly to development in their country of origin. More specifically, this project, seeks to provide access to affordable loans to Colombian migrants in Spain, provided by a Spanish partner financial institution. The project will be implemented in two phases: a preparatory and launch phase. The preparatory phase will ensure the establishment of partnerships for a) extending loans to Colombian migrants in Spain, b) for managing the loan guarantee fund in Colombia and c) for capitalisation of the loan guarantee fund.
In the second phase the selected Spanish financial institution will open lines of credit to Colombians in Spain for investment in their county of origin. The loans would enable migrants to make investments in home acquisition, education, or small and medium enterprises (SME) in Colombia. The creation of this fund provides opportunities for Colombian migrants to develop projects in their country of origin; it is also intended to increase the motivation for their return.
The 1035 Facility allocation will provide funds for the preparatory phase (30-40% of the allocation) and once partnerships are in place including contributors to the IGF-COL, the facility will contribute to the seeding of the Fund (balance allocation).