Small, medium-sized enterprises (SMEs) and very small businesses are widely recognized for the important part they play in economic growth, innovation, regional development and job creation.The dynamism and vitality of this segment build a good foundation to improve the standard of living and reduce poverty. Emerging and frontier Markets SMEs are struggling to obtain financing, which is essential for a vibrant and healthy private sector.
Without adequate financing mechanisms, private investment, as well as corporate working capital, is in difficulty. As a result, business creation is limited, existing firms have difficulty expanding, and consequently, economic growth is limited or non-existent. While large Emerging and Frontier Markets firms also face problems of underfinancing, in fact, SMEs are the most particularly affected. Microenterprises, on the other hand, are partially covered by microfinance institutions. In order to unleash the Emerging and Frontier Markets full potential and achieve smart, sustainable and inclusive growth, Emerging and Frontier Markets needs to address the issue of access to finance which depends primarily on the availability of financial resources, but also on accessibility according to financing characteristics in terms of cost and maturity of debt. PrivateGrowth Fund is addressing this “missing part” by developing a comprehensive solution targeting SMEs in Emerging Market in specific sectors of agribusiness, infrastructure and renewable energy.