IDB Invest, eFactor Network, Grupo Arteche Launch Sustainable Financing to Support Energy MSMEs
IDB Invest will provide a sustainable reverse factoring line of up to $20 million that will be available to the suppliers of Grupo Arteche, one of the leading companies in the transmission and distribution sector, focused on the design, manufacture and sale of electrical equipment and solutions for power networks.
Under the line, Arteche's suppliers in Mexico, Argentina and Brazil – mostly micro, small and medium-sized enterprises (MSMEs) – will be able to advance the collection of their invoices payable by Arteche, through IDB Invest. The product provides MSMEs with access to financing under competitive terms and conditions not typically available to this type of company, consistent with Arteche's credit strength.
The project also includes IDB Invest’s expertise on sustainable development and that of experts specialized on sustainable development and value chains to help transfer Arteche's sustainability strategy to its suppliers. To this end, economic incentives have been incorporated for those suppliers that provide Arteche with their products in sustainable packaging, either packaging that does not contain single-use plastic or that is made from recycled cardboard.
IDB Invest and Arteche have launched this initiative together with eFactor, a leading Fintech in Mexico in the financing of working capital, acting through its platform as a great connector between the participants, allowing them to operate in real time, and optimizing the flow of assets, funds and business information.
With this project, IDB Invest, Arteche and eFactor deepen their support to improve MSME financing for financing and improving opportunities for MSMEs, and for encouraging encourage sustainable practices in the supply chain of the electricity sector. In Latin America and the Caribbean (LAC) MSMEs make up 99% of the companies in the region, employ 60% of the workers and represent 40% of the GDP. However, they receive less than 15% of the credit granted to companies.
The project also seeks to support partners such as Arteche, who are committed to investing in electrical infrastructure in the region, given the growing global energy demand and the need to increase access.
The deal is expected to contribute to the following United Nations Sustainable Development Goals (SDGs): Decent Work and Economic Growth (SDG 8), Industry, Innovation and Infrastructure (SDG 9), and Responsible Consumption and Production (SDG 12).
About IDB Invest
IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social, and environmental development in the region. With a portfolio of $15.3 billion in asset management and 375 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.
About Arteche Group
Founded in 1946, the Arteche Group operates within the electrical sector, from generation to distribution, specializing in the electrical equipment, components and solutions industry. Within this framework, the Arteche Group is in the top 3 of world leaders in the instrument transformers market, and is number one in auxiliary relays, and maintains a regional leadership position in the rest of the products, especially aimed at markets with high demand and added value, such as renewable generation and the railway sector. The Arteche Group's business is focused on enabling the transmission and distribution of electrical energy from any generation plant to the end user with efficiency, quality and reliability. That is why the company invests recurrently in R+D+i, looking to improve the quality and efficiency of its products, innovating in the development of new products and offering the customer differential added value. Currently, Arteche is present in more than 175 countries with commercial distribution capabilities; it has 13 factories in Europe, America, Asia and Oceania, including 6 centers dedicated to research; and has more than 2,600 employees around the world.
eFactor is a Fintech company, leader in financing solutions and optimization of supply chain working capital, started in 2009 with the vision of helping large purchasing organizations improve their working capital by extending payment terms without increasing the load your supply chain, and serve your suppliers by giving you the option of obtaining early payment at attractive financing rates, all through electronic factoring. Through its platform, eFactor provides immediate liquidity to more than 16,000 providers, with funds from the most important financial institutions in Mexico and other countries. The most important value proposition for clients has been a multi-funding, multi-region and multi-currency solution. eFactor has important alliances with the IFC World Bank, IDB Invest, FIRA, Bancomext and PrimeRevenue; Today it has around 150 corporate and 20,000 users in more than 30 countries. If you want to know more visit: www.efactornetwork.com.