Proparco Commits $20M to Boost Women-Led SMEs in Vietnam

Proparco, the development finance institution of France’s Agence Française de Développement (AFD) Group, has committed a $20 million senior loan to EVF General Finance Joint Stock Company (EVF) in Vietnam. The funding will support climate finance and improve access to capital for small and medium-sized enterprises owned or led by women.

EVF Deputy General Director Nguyen Xuan Diep and Rebecca Maalouf Bauden, AFD’s Country Director in Vietnam, signed the credit agreement on 8th September. The deal strengthens the partnership between Proparco and EVF and marks a new phase of cooperation focused on sustainable and inclusive growth.

The latest financing builds on Proparco’s $10 million loan to EVF in 2021, which supported the company’s climate finance initiatives. The new funding will help EVF expand green financial solutions while supporting sustainable development and greater financial inclusion in Vietnam.

The agreement will allocate 50% of the $20 million loan to projects that have climate benefits, and 50% of the loan will be dedicated to women-led or women-owned small and medium-sized enterprises (WSMEs).

Key Highlights:

• Proparco has committed $20 million to EVF to support climate finance and women-led SMEs
• Half of the loan will fund climate projects, while the other half will support women-owned and women-led businesses
• The partnership supports Vietnam’s net-zero goal and promotes sustainable, inclusive finance

The concentration is on two key priorities that are growing in importance for Vietnam's economy: transition to a low-emissions development model and better access to finance for production and business activities for women.

International capital attractiveness and proper resource allocation to projects with positive environmental and climate effects will be crucial in the long-term economic transition of Vietnam to become a net-zero country by 2050.

Meanwhile, women entrepreneurs are still having an important presence in Vietnam's business sector, but there are still certain obstacles in terms of access to capital and business expansion. Half of the loan has gone to this group, which is in line with EVF's desire to provide funding in a fair and inclusive way, with a focus on the needs of the business world.

The investment also allows the project to fulfil the 2X Challenge, an international initiative that seeks to encourage women's economic empowerment through investment and finance.

The ongoing cooperation with Proparco was a significant step in EVF's sustainable finance evolution, said Dinh Ngoc Bao, EVF's deputy head of the funding department and director of international markets department.

"To date, EVF has allocated more than $280 million to green finance and more than $700 million to WSME financing, demonstrating our commitment to expanding access to responsible capital and promoting sustainable economic growth in Vietnam," Dinh said.

"EVF expects to build further on its partnership with Proparco while developing innovative financial solutions to meet the changing needs of businesses and contribute to Vietnam's long-term development goals," he added.

The new loan contributes to France's commitment under the Just Energy Transition Partnership (JETP), a framework through which Vietnam and international partners mobilize resources for the country's energy transition. It supports Vietnam's efforts to accelerate the transition towards its goal of net-zero emissions by 2050.

Jean-Benoît du Chalard, Proparco's regional director for North and Southeast Asia, said: "We are pleased to continue supporting EVF, a long-standing partner of Proparco, and through this new transaction contribute to two key priorities for Vietnam: accelerating finance for the climate transition and improving access to finance for women entrepreneurs."

The continued partnership with Proparco reinforces EVF's position within a network of financial institutions focused on sustainable development, while providing further room for the company to expand green and inclusive finance and develop capital solutions suited to the evolving needs of Vietnamese businesses.