THE Inter-American Development Bank (IDB) has approved a US$20 million loan to the Caribbean Development Bank to bolster private-sector development and boost the productivity of micro, small and medium-sized enterprises (MSMEs) in Antigua and Barbuda, Dominica, Grenada, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines.

These are all eligible members of the Organisation of Eastern Caribbean States.

According to a release, the Global Credit Loan was granted to the Caribbean Development Bank to spur environmental and other innovation at the companies. It will also fund grants channelled to MSMEs through business support organisations in order to strengthen the market for services that help businesses adopt climate and digital technologies.

The programme will also urge MSMEs to adopt climate technologies and digitalise their processes through lines of credit for working capital and capital investments that will be brokered by financial institutions. A minimum of 30 per cent of the loans will be earmarked for buying equipment, software, consulting services, and other investments related to using technology to modernise and digitally transform the businesses, and to projects at eligible business to mitigate and adapt to climate change. Qualifying projects include solar panel installations.

The programme will finance campaigns that specifically target businesses run or owned by women, thus promoting gender equality and women’s empowerment. The objective is to raise awareness about both grant programmes for innovation and technology adoption programmes in industries that affect female employment. Part of the resources will also be used to analyse and design policy frameworks that promote or enhance gender diversity in the workplace.

The programme will directly benefit approximately 596 legally established MSMEs, regardless of their industry. At least 17 per cent of these businesses will be owned by women, the bank said. The loan will also indirectly aid business support organisations and financial intermediaries in eligible Organisation of Eastern Caribbean States member countries, which will develop the measures to support innovation and uptake of climate and digital technologies.

The $20 million IDB loan has a 23.5-year repayment term, a seven-year grace period, and an interest rate based on the Secured Overnight Financing Rate (SOFR).