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35%Agriculture
USAID’s Development Credit Authority (DCA)As we work to maximize investments in foreign aid throughout the developing world, USAID’s Development Credit Authority (DCA) uses loan guarantees to increase access to finance and promote growth in developing countries.
The lack of access to credit is one of the primary constraints to economic growth throughout the developing world. Despite holding large sums of local capital, local banks and other formal financial institutions are often reluctant to lend this capital to small- and medium-sized enterprises, primary drivers of broad-based job creation and growth.
28%Multi-Sector
3%Health
3%Water
2%
1%Housing
Infrastructure
Loans Disbursed under DCA Guarantees by YearPortfolio Key Results
(1999-2016)
542 Guarantees
$4.8 Billion Committed
381 Financial Partners
76 Countries
2.6% Default Rate
2016 Key Results Since 2008 2016 Portfolio by Sector
36% 64%Female
BorrowersMale
Borrowers
38 % First-Time Borrowers
56 Guarantees
$892 Million Committed
55 Financial Partners
27 Countries
$ $30= VALUE OF DCA LOANS DISBURSED IN FISCAL YEAR ($ MILLIONS) = NUMBER OF LOANS DISBURSED
$60 $90 $120 $150 $180
18K1K
11K
16K
2K8K
20K
7K
32K8K
13K39K
6K
2014
2016
2012
2010
2008
2006
2004
2002
200011
2K
30K
x
28%Energy &
Environment
Metrics Dashboard A Sample of DCA Guarantee Products
Borrower Trustee Guarantee Loans/Funds RepaymentLenderKEY
G
G
G
G
B B
B
T
T
B
B
LL
L
L
Partnership Opportunity:
Global
LATIN AMERICA & THE CARIBBEANAFRICA ASIA/MIDDLE EAST & NORTH AFRICAEUROPE & EURASIA
Overall
13
$190
active guarantees
million guaranteedlending
2016
million guaranteed lending
$32
A bond guarantee is a guarantee on a corporate
or sub-sovereign bond issuance. The guarantee frequently
enables the bond issuer to obtain a higher credit rating and therefore access less expensive
and longer-term credit.
A loan or lease portfolioguarantee is a guarantee on a portfolio of loans or leases that a financial institution makes in an identified sector.
A loan guarantee is a guarantee on one loan between an identified lender and an identified borrower.
In 2016, over $12 milion was disbursed by Bancamia and Bancompartir to meet the financing needs of over 10,000 micro, small, and medium-sized (MSME) agriculture producers and agribusinesses in poor, rural, and conflict-affected areas of Colombia.
More than $3 million in loans have been disbursed to coffee cooperatives in Honduras, Nicaragua and Peru as part of a regional initiative to address the worst outbreak of coffee rust in Central America since the pathogen first appeared in 1976. These loans have supported coffee tree renovation and rehabilitation efforts as coffee farmers respond to the crisis.
Since 2003, nearly $34 million has been lent to over 20,000 MSMEs, of which $1.8M was disbursed in 2016, promoting legal livelihoods in former coca-producing regions in Peru.
In 2016, nearly $8 million was lent to social enterprises providing needed technologies to rural poor in Kenya, Rwanda, Tanzania, and Uganda, from cookstoves to solar lanterns to water filters, helping to protect their health and the environment in partnership with the co-guarantor, the Swedish International Development Cooperation Agency (Sida).
In partnership with the Essential Capital Consortium, USAID’s Global Development Lab, USAID’s Asia Bureau, and the U.S. Department of State, $10 million was disbursed in Mexico and India in support of social enterprises in the education and health sectors.
Over $13 million was disbursed by the Athelia Fund in 2016 for sustainable land-use activities in Peru, Guatemala, and Brazil that will generate emission reductions, including Reduced Emissions from Deforestation and Degradation (REDD+) projects that earn carbon offset credits while also creating sustainable jobs for local populations.
In 2016, DCA partnered with Power Africa to issue a $60 million guarantee to Standard Chartered Bank to cover lending to ZESCO, an electric utility in Zambia. This loan is funding an increase in grid connections in the country.
2016 Highlights
2016 Highlights 2016 Highlights2016 Highlights
2016 Highlights
Since 1999, more than $250 million has been lent under DCA guarantees to farmers and firms across the African agricultural sector, including $2.5 million for agricultural equipment in Senegal, leased by Locafrique in 2016, supporting the growth of the country's leasing sector.
Root Capital, a U.S. non-profit investment fund, lent nearly $2.5 million across Africa under a DCA guarantee in 2016 to small and growing agri-businesses, several of which used the working capital to process and export agricultural products.
Two financial institution partners in Bosnia & Herzegovina disbursed over $8 million combined in 2016 to SMEs in a variety of sectors including agriculture, manufacturing, and renewable energy. These guarantees are in close collaboration with, DCA's co-guarantee partner, the Swedish Development Agency (Sida)
In 2016, local banks in Kosovo disbursed nearly $2 million in agricultural loans covered by DCA guarantees, on top of the already $21 million disbursed previously. After partnering with DCA on this guarantee facility and witnessing its success, the Government of Kosovo established the Kosovo Credit Guarantee Fund, modeled after DCA, to issue its own guarantees to mobilize financing for SMEs across the country.
Catalyzing lending for a renewable energy company, increases affordable solar energy access across Uganda.
Uganda
Enabling farmers and microentrepreneurs,
particularly women, in Burma to expand their
opportunities with access to credit.
Burma
Supporting banks to expand lending, in
particular for women working in Tanzania's
agriculture sector.
Tanzania
After only one year with a USAID guarantee, ProCredit in Ukraine has already disbursed $2.6 million in loans to eighteen SMEs in the agriculture and energy efficiency sectors.
Since 2011, more than $4 million has been lent to 1,600 smallholder farmers, of which $900,000 was disbursed in 2016 across Tajikistan for purchase of inputs, irrigation equipment, and other agricultural equipment. USAID partner financial institutions have created loan products specifically for agricultural borrowers and women entrepreneurs alongside the guarantee.
In 2016, Caspian Impact Investments disbursed more than $7 million to 20 social enterprises in India distributing goods and services to poor communities.
In partnership with four financial institutions, $11.5 million was disbursed to over 4,500 SMEs in 2016 throughout Pakistan, increasing access to credit across sectors including private education, information and communication technology, manufacturing, textiles, healthcare, trading, energy, construction, and agribusiness.
Encouraging lending to farmers, including this strawberry farmer, across Kosovo.
Kosovo
Helping small, capital-constrained financial institutions access financing to on-lend to small businesses and entrepreneurs, including a fish processing company, creating new opportunities for Mexican workers and businesses.
Mexico
Preserving tropical forest and creating
livelihoods in Guatemala through innovative finance
for local sustainable forestry cooperatives.
Guatemala
Sharing risk with investors to leverage private sector funding for municipal water infrastructure allowing Indian citizens to access clean affordable water.
India
Partnering with the people of Macedonia
to mobilize lending for farmers, like this one,
to invest in new technologies such as
drip irrigation.
Macedonia
https://usaid-credit.exposure.co#DCAStories
https://usaid-credit.exposure.co#DCAStories
https://usaid-credit.exposure.co#DCAStories
https://usaid-credit.exposure.co#DCAStories
https://usaid-credit.exposure.co#DCAStories
https://usaid-credit.exposure.co#DCAStories
https://usaid-credit.exposure.co#DCAStories
https://usaid-credit.exposure.co#DCAStories
15KTotal Guaranteed Lending246,445 loans$1.8 billion
Overall135
$549
active guarantees
million guaranteed lending
2016
$107 million guaranteed lending
Overall47
$341
active guarantees
million guaranteed lending
2016
million guaranteed lending
$25
Overall42
$357
active guarantees
million guaranteed lending
2016
million guaranteed lending
$31
Overall56
$358
active guarantees
million guaranteed lending
2016
million guaranteed lending
$48
Private companies, donors, governments, and other organizations can fund DCA guarantees aligned with their strategic interests. DCA has experience working with each of these types of partners across all regions.
17K
$210 $240
ZmZambia$63.4M Ke
Kenya$10M
ZaSouth Africa
$6.7M
AfAfrica Regional
$3.8M
SnSenegal$2.6M
LrLiberia$2.5M
EaEast Africa
$2.4M
AoAngola$2.3M
GhGhana$2M
ZwZimbabwe
$1.7M
BwBotswana
$1.4MUg
Uganda$1.4M
EtEthiopia$1.1M
MgMadagascar
$1.1M
MzMozambique
$1.1M
NgNigeria$1M
MlMali
$1.3M
TzTanzania$700k
WaWest Africa
$500k
GnGuinea$190k
NeNiger$10k
SsSouth Sudan
$4k
Through the use of DCA loan guarantees, USAID incentivizes these institutions to begin lending in new sectors and to new borrowers; lending that will both increase their bottom lines while promoting prosperity and security. This “crowding-in” of private capital through the use of guarantees is accomplished at a fraction of the cost of conventional donor support and seeks to permanently replace short-term donor funding with long-term and sustainable, locally-generated, private capital.
None of this work is possible without strong partnerships. This 2016 Impact Brief highlights DCA’s many partnerships since its inception in 1999, including in-depth stories we have developed online across each region, highlighting the impact of USAID’s guarantees as loans go out the door. We encourage you to visit https://usaid-credit.exposure.co or #DCAStories on Twitter to learn more about USAID’s work supporting financial inclusion around the world.
"Thanks to solar lighting [made possible by a DCA guarantee] we can read and work at night and our
children and our neighbors' children can study their schoolwork past dark."
-Emma Kakumba; Katoogo Uganda
"I used the money I saved from more affordable water [made possible by a DCA guarantee] to
start my own business."-Valarmathi; Chennai, India
Pictured from left to right Robinah Namugambe, Setimba Yaziidih, Seriiso Yasiin, Emma Kakumba; Katoogo, Uganda
BdBangladesh
$200k
InIndia
$24.2MId
Indonesia$1.7M
KgKyrygz Republic
$3k
MaMorocco$1.8M
NpNepal$500k
PkPakistan$11.5M
PhPhilippines
$7.5M
TjTajikistan
$900k
BaBoznia
Herzegovina$8.5M
AlAlbania$3.7M
KoKosovo$3.1M
UaUkraine$3.1M
AmArmenia
$2.1MGe
Georgia$1.8M
MkMacedonia
$1.2M
AzAzerbaijan
$600kMdMoldova
$400k
PePeru
$2.3M
GtGuatemala
$3.5M
BrBrazil$7.3M
TzTanzania
$2.7M
MxMexico
$4M
InIndia
$6.1M
BjBenin$900k
GhGhana$700k
SvEl Salvador
$100k
IdIndonesia
$70k
HtHaiti
$200k
KeKenya$600k
RwRwanda
$1M
UgUganda$1.7M
NgNigeria$300k
SgSenegal$200k
ZaSouth Africa
$200k ZmZambia$400k
CoColombia$12.1M
SvEl Salvador
$4.6M
GtGuatemala
$60k
HtHaiti
$400kJmJamaica
$1MLa
LAC Regional$500k
MxMexico$8.4M
NiNicaragua
$2.3M
PyParaguay
$200k
PePeru
$1.8M
Changing the African landscape by strengthening the flow of private capital for agricultural production, infrastructure development, and renewable energy production.
Accelerating economic growth by increasing access to finance for small- and medium-sized enterprises (SMEs), particularly those in the agriculture, clean energy, and information and communications technology sectors.
Expanding access to finance toincrease rural incomes foragricultural producers;transition more farmers fromcoca to legal crop production;encourage investment forclean energy; and create moreeconomic opportunities, thereby addressing a root cause of irregular migration from the region.
Piloting innovative guarantee structures with new partner types across Asia's more developed markets while continuing to deploy traditional DCA structures, in support of small and medium enterprises (SMEs), agriculture, renewable energy, women-owned and -managed businesses, and trade.
Partnering with global banks, investment funds, and other multinational financial institutions with a large geographical scope to unlock private capital across USAID's priorities.
Co$3M
Colombia
1
Ht$4.5M
Haiti
1
Co$46M
Colombia
2
Ng$7.6M
Nigeria
1
Sn$6.8M
Senegal
1
Et$10M
Ethiopia
1
Rw$5.9M
Rwanda
1
Za$200M
South Africa
1
Ug$10M
Uganda
2
Za$15M
South Africa
1
Wa$24M
West Africa
1
Tz$15.8M
Tanzania
2
Mw$15M
Malawi
1
Ke$17.4M
Kenya
2
Gh$5M
Ghana
1
Bf$15.8M
Burkina Faso
2
Le$30M
Lesotho
1
Af$18.9M
Pan-Africa
1
Dc$8.9M
Democratic Republic of Congo
2
Af$50M
Pan-Africa
1
In$9M
India
1
Kz$15M
Kazakhstan
2
Pk$88.1M
Pakistan
5
In$75M
India
1
Np$5M
Nepal
1
As$22.5M
Cambodia, Philippines, Vietnam
1
Bu$10.5M
Burma
5
2016 PERIODIC TABLE OF GUARANTEES
Welcome Note
Regions:
Agriculture
Micro-, Small- and Medium-Sized Enterprises
Energy
Health
Infrastructure
Trade
Housing
Environment
Water
Women
AaMillion Committed
Country
Country Abbreviation
Sector Symbol# of Guarantees (Partners) #
Gb$50M
Global
1
Ba$3.5M
Bosnia & Herzegovina
1
Mk$20M
Macedonia
5
Asia Africa Europe & EurasiaLatin America & the CaribbeanGlobal
Ht$6M
Haiti
1
Mx$25M
Mexico
2
Py$5.3M
Paraguay
1
Co$47M
Colombia
3
1999-2016
56
2016
$892M
Guarantees
55 Partners
27 Countries
542
$4.8B
Guarantees
Commitments
Commitments
381 Partners
76 Countries
We are pleased to share USAID’s 2016 Development Credit Authority (DCA) impact brief with you.
In 2016, USAID issued 56 guarantees, through 34 transactions, across 27 countries, mobilizing $892 million for USAID priorities. Guarantees this year will unlock financing for clean energy in Pakistan, electrical grid connections across Africa, preservation of forests in Mexico, and drip irrigation for farmers through a partnership with the people of Macedonia. Overall, in its 17-year history, DCA guarantees have made possible $4.8 billion in lending across 76 countries with 381 partner institutions, and 2016 was the largest year yet.
DCA continues to maximize its operating efficiency, delivering an already powerful cost-effective tool at an even greater value to taxpayers. For every $1 of its operating budget, DCA mobilizes $118 in private sector credit, up from $6 in 2000.
DCA was created on the simple notion that loan guarantees, by unlocking local capital, are a more sustainable way to accelerate development. Lending to targeted sectors and borrowers occurs that otherwise wouldn’t and, in most cases, continues long after guarantee coverage expires. Borrowers demonstrate their creditworthiness to lending institutions, and those institutions come to understand new customers and sectors better. We invite you to read more about DCA’s impact inside.
This year also marks the first year the 17 Sustainable Development Goals (SDGs) in the 2030 Agenda for Sustainable Development, adopted by world leaders at an historic United Nations Summit in 2015, are officially in effect. We’d like to take the opportunity to highlight some of DCA’s contributions to the SDGs by noting a few of DCA’s 2016 commitments (see right-hand side).
www.usaid.gov/dca
U.S. Agency for International DevelopmentDevelopment Credit Authority1300 Pennsylvania Avenue, NWWashington, DC 20523
Tel. (202) 216-3316Fax (202) 216-3228E-mail: [email protected]
@USAID_Credit
facebook.com/usaid.dca
USAID’s Development Credit Authority (DCA) uses loan guarantees to increase access to finance and promote growth in developing countries. This infographic highlights 34 guarantee transactions making up DCA’s 2016 portfolio of new guarantees.
Through its 2016 portfolio consisting of 34 guarantee transactions and $892 million in new commitments, USAID’s Development Credit Authority (DCA) is contributing to nearly all of the 17 U.N. Sustainable Development Goals, including these notable highlights.
Global: A DCA loan guarantee will expand lending to the sustainable fisheries sector in support of fishing communities and the sustainable use of oceans, seas, and marine resources.
Malawi: A DCA loan guarantee will expand lending to women, supporting equal rights for women to economic opportunities, and to farmers, promoting increased agriculture productivity and environmental resilience.
Mexico: DCA loan guarantees will expand lending to businesses producing certified sustainable agriculture and engaging in livestock-ranching and forestry management activities, which will result in additional jobs, higher incomes, strengthened environmental resilience, and reduced land degradation and biodiversity losses.
Rwanda: A DCA loan guarantee will increase lending to health care providers and producers of water treatment and purification products or sanitation products in support of healthy lives and access to safe, affordable drinking water and adequate sanitation for all.
2016 Impact Brief
DCA and U.N. Sustainable Development Goals 2016 Transaction Highlights
USAID’s Development Credit Authority
