The loan will allow financial institutions, including the National Savings and Financial Services Bank, to improve their performance, widen their user base and expand their financial service packages. It would also help in providing financial education to the public, especially among the marginalized sector, and encourage them to use more formal financial services instead of going to pawnshops and loaning from individuals, which are usually more expensive.
“Access to formal financial services promotes economic and social development. Financial inclusion has always been a priority for Mexico’s development agenda. However, insufficient financial education, distrust of credit and savings institutions, as well as their limited access and lack of product and service variety, become obstacles to overcome,” World Bank Director for Mexico and Colombia Gloria Grandolini said.
The World Bank has been providing support to the Mexican government in credit and savings sector reforms since 2001. The new project, titled Financial Consolidation and Inclusion Project, will also receive funding from the country’s Treasury and Public Credit Ministry and other beneficiaries to cover the expected total cost of $209.62 million.
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