Barbados’ micro, small, and medium-sized enterprises (MSMEs) are set to benefit from a major financial boost as the Inter-American Development Bank (IDB) extends a $100 million loan to the Central Bank of Barbados. The funding will strengthen the Central Bank’s Enhanced Credit Guarantee Fund (ECGF), designed to ease access to credit for local businesses.
Since its launch in 2015, the ECGF has already approved 326 guarantees worth over $130 million across eight participating financial institutions. The new loan, announced under the IDB’s Flexible Financing Facility, is expected to directly benefit 188 companies, while also supporting suppliers, partners, and broader economic activity.
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The financing will provide loan guarantees through local intermediaries, enabling MSMEs to invest in critical areas such as property, infrastructure, equipment, and new technologies. Importantly, the programme will also prioritize underserved segments including women-led enterprises, exporters, and businesses focused on renewable energy, efficiency, and climate resilience.
According to the IDB, guarantees will cover up to 80 percent of each loan, with a maximum of $2 million per loan. By reducing credit risk, the scheme will allow lenders to extend loans on more competitive terms.
This marks the third phase of IDB-supported funding for MSMEs in Barbados.
- The first round in 2015 focused on productivity and competitiveness.
- The second round in 2021, during the COVID-19 pandemic, provided critical collateral support for short-term capital and medium-term investments.
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Central Bank Governor Dr. Kevin Greenidge praised the IDB’s ongoing partnership, noting that it has been key to unlocking financing for small businesses. The 2024 Annual Report highlighted that the earlier programmes were fully disbursed, with 41 guarantees still outstanding at year-end and continued strong demand for COVID-era support.
With this new $100 million injection, Barbados is reinforcing its commitment to MSMEs—businesses that account for over 90% of formal enterprises and nearly 60% of private-sector jobs—ensuring they can drive innovation, growth, and resilience in the economy.
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