The Central American Bank for Economic Integration (CABEI) approved two “non-reimbursable technical cooperations” for the Banco de Fomento Agropecuario (Bank for Agriculture Promotion) (BFA), a financial institution of the Republic of El Salvador.

These grants fall under the framework of the Program of Technical and Financial Cooperation for the Micro, Small, and Medium Enterprise (MSME) sector. This program jointly channels technical assistance resources from CABEI, the Spanish Agency for International Cooperation (Spanish acronym AECI), and the German Development Bank KfW Bankengruppe (KfW).

One objective of this program is to strengthen financial institutions that service the MSME sector. These institutions have become important CABEI strategic allies for channeling resources to this particular business sector.

The funds, totaling US$18,637.50, will be used to finance two BFA projects. One is a diagnosis that will help BFA create an internal structure that maximizes the operational efficiency of its branches. Another will allow BFA to develop a risk manual and incorporate risk management functions within its organizational structure.

CABEI once again demonstrates its commitment to strengthen institutions that provide financing to MSMEs. These cooperations will help BFA increase services to MSMEs that exist within the industrial and commerce and service sectors. The resources will also provide incentives for financing handmade products and for financing ethnic product exportation.

About BFA

The Banco de Fomento Agropecuario (BFA) was created by means of Legislative Decree in April 1973 with the objective of financing the production and diversification of the agriculture sector. BFA began operations in May 1973. Forming part of the national banking system, BFA is subject to oversight from the Superintendent of the Financial System, and because BFA is a state institution it is also subject to oversight from the Court of Accounts of the Republic. The BFA central office is located in the city of Santa Tecla, with 24 service centers located in various other parts of the country.