The government of Guatemala has activated a fund of fifty million quetzales intended to provide low-interest loans to cooperatives and microfinance organizations. The clear objective is to mitigate the impact of rising fuel prices on the costs of micro, small, and medium-sized enterprises (MSMEs) that are part of the basic food supply chain. This new policy, officially presented by the Deputy Minister of MSME Development, Elizabeth Ugalde, aims to facilitate access to financing under exceptional conditions, particularly for companies that produce, distribute, or market essential food products for Guatemalan households.
Through this mechanism, approved on April 16th by the MSME Council, interested cooperatives can access loans with a 0% interest rate, which they must then transfer to MSMEs at a maximum annual rate of 5%.
According to the official, the usual market rates for productive loans range between 11% and 13%, and can even exceed 40% in some institutions, representing a significant difference for the beneficiaries of this program.
This information, provided by Ugalde during a conference broadcast by the government channel and reported by the press, highlights the unusually favorable nature of the offered interest rate.
The financing policy prioritizes the food supply chain and family costs.
The Executive's plan, led by President Be…
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The infographic details a new 50 million quetzal state fund in Guatemala for soft loans, supporting micro, small, and medium-sized enterprises (MSMEs) in the food supply chain in the face of rising fuel costs, and benefiting family economies. (Illustrative Image: Infobae) The government of Guatemala has activated a 50 million quetzal fund to provide soft loans to cooperatives and microfinance associations, with the clear objective of reducing the impact of rising fuel prices on the costs of MSMEs that are part of the basic food supply chain. The new policy, officially presented by the Deputy Minister of MSME Development, Elizabeth Ugalde, seeks to facilitate access to financing under exceptional conditions, particularly for companies that produce, distribute, or market essential foods for Guatemalan households. With this mechanism, approved on April 16th by the MSME Council, interested cooperatives can access loans with a 0% interest rate and must transfer these funds to MSMEs with a maximum annual rate of 5%. According to the official, the usual market rates for productive loans range between 11% and 13%, and even exceed 40% in some institutions, which marks a significant difference for the beneficiaries of this program. This data, reported by Ugalde in the conference broadcast by the government channel and reported by the news outlet, underscores the unusually favorable nature of the offered rate. The government of Guatemala has allocated a 50 million quetzal fund in soft loans for cooperatives and microfinance institutions linked to the basic food basket. (Photos: Diario de Centroamérica) The Executive's plan, led by President Bernardo Arévalo, is specifically aimed at MSMEs that are directly involved in the production, marketing, storage, or distribution of foods that make up the Guatemalan basic food basket. The recipients include both wholesalers and retailers in this segment, a business population whose stability, according to the president, "directly impacts the economy of thousands of families throughout the country." According to Deputy Minister Ugalde, the scheme has been designed as a pilot plan and operates with existing funds under the MSME trust. This avoids the need to implement additional expenditures in the national budget and allows for the rapid channeling of resources through the Ministry of Economy (MINECO). "We will provide these loans to cooperatives at a 0% interest rate. They will not have to pay interest, only the principal. In return, the condition is that they allocate loans to MSMEs at a rate of 5%," Ugalde assured in her public address. The term for the loans, for both cooperatives and MSMEs, will be six years, while the policy will remain in effect for twenty-four months from its implementation. After this phase, the fund and its effects will be reevaluated to determine whether an increase or extension is appropriate, according to the Deputy Minister. The government of Guatemala has allocated a 50 million quetzal fund in soft loans for cooperatives and microfinance institutions linked to the basic food basket. (Photos: Diario de Centroamérica) According to Elizabeth Ugalde, the program was launched in response to the pressure that the cost of fuel exerts on the price structure of MSMEs, with the aim of "relieving the burden on the pockets of people who consume products from the basic food basket." President Bernardo Arévalo, during the presentation accompanied by Ugalde, stated that this measure is part of a broader effort to support family economies in the face of the country's inflationary situation, focusing government intervention on sectors whose stability allows mitigating the effects of the international environment on the cost of essential foods. This policy places Guatemala among the first countries in the region to implement zero-interest credit lines for financial intermediaries, with the commitment to pass on these benefits to MSMEs in the basic food chain, thus reinforcing the State's commitment to food security and price stability for final consumers.