CAF and Bancóldex sign agreement for greater opportunities for Colombian entrepreneurs
The arrangement includes CAF’s interest in becoming an investor in the Bancóldex Fund of Funds, focusing on venture capital, with a share of up to 20% of the Fund’s total commitments.
CAF—development bank of Latin America—and Bancóldex, Colombia’s business development bank, signed a Memorandum of Understanding to boost productivity of small and medium-sized enterprises and promote investment in businesses through venture capital funds. The agreement will foster use of and access to financial products, technical assistance and knowledge transfer, with an emphasis on business innovation, internationalization and growth.
Both institutions will work on the definitions that could lead to a CAF investment in the Bancóldex-led instrument, the Fund of Funds.
Bancóldex, as a business development bank and pioneer in Colombia’s private equity industry, launched this instrument with a view to mobilizing third-party funds to the Venture Capital Funds industry in Colombia and the region, thus promoting alternative financing mechanisms for entrepreneurs and businessmen.
The Bancóldex Fund of Funds is the third of its kind worldwide after Korea and Mexico, and it is managed by a public entity with public and private funds. It is a new vehicle that is expected to mobilize funds in order to boost young companies with high growth potential. CAF could become the first multilateral investor in the Fund of Funds.
In addition, the activities to be jointly developed by CAF and Bancóldex under this agreement include exploring alternatives to bolster the use of and access to financial products for MSMEs; the SME Productivity Support Program, which includes business innovation, internationalization and productive integration (clusters and value chains); and co-financing of operations in the Renewable Energy and Real Sector companies focusing on exports, among others.
At the signing of the MoU, CAF executive president Luis Carranza assured that “these initiatives will promote financing to SMEs that have specific projects for internationalization and tapping international markets, innovation in products, services and processes, or that wish to effectively integrate into both regional and international value chains and clusters, in order to boost productivity, the integration process and economic development of Pacific Alliance members.”
“We are pleased and proud of CAF’s participation in our Fund of Funds; we welcome it as a positive response from a great investor who has placed its trust in our nearly 30-year experience, which includes investing in venture capital funds as a key tool to promote financing of companies, ventures and the Orange Economy as drivers of economic development in Colombia and the region, while also strengthening our cooperation ties,” noted Javier Diaz Fajardo, president of Bancóldex.
In the framework of the 14th Pacific Alliance Summit, CAF also signed MoUs with counterparts such as COFIDE (Peru), NAFIN and Bancomext (Mexico), with new agreements to be signed with CORFO (Chile), which is the other development banks of the Pacific Alliance. The purpose of these agreements is to foster the use of and access to financial products and technical assistance for SMEs in different areas of common interest.
CAF's more recent content
Telefónica and Compromiso Empresarial Reward CAF Social Innovation
Telefónica and specialized business magazine Compromiso Empresarial have recognized the innovation and excellence of the 10 best practices in transparency and good governance of 2018 in Spain and Latin America, which include the citizen oversight initiative in La Guajira, Colombia, led by FUCAI and CAF.
CAF Impact Assessment to Reduce Alcohol Consumption in Colombian Children
Underage alcohol consumption in high in Colombia. According to the 2016 National Study on the Consumption of Psychoactive Substances in the School Population (ENCSPPE), the average age of onset of consumption is between 12 and 13 years, which can affect children's brain development. In addition, frequent alcohol intake affects mental health, physical health and psychic and social development; and at excessive levels, can curb school performance and lead to alcohol dependence in adulthood.