Proparco continues to support Bank of Palestine, the leading banking group in the West Bank and Gaza, by granting an ARIZ MENA portfolio guarantee funded by the European Union (EU) to the Bank of Palestine (BOP) of 9.2 MUSD, Proparco aims to foster financial inclusion and strengthen the Palestinian private sector, particularly high impact MSMEs.
Palestinian economy remains unique with Micro, small, and medium-sized enterprises (MSMEs) accounting for 95 percent of Palestinian businesses, with the vast majority still facing obstacles in accessing finance. This difficulty in obtaining loans has been exacerbated by the pandemic and as such it is incumbent upon development agencies and banks to work on providing financial solutions and products to help increase access to finance for this important sector.
The project includes a performance bonus triggered if the bank achieves high social and societal impact lending. The objective is to encourage the bank to target segments underserved by the banking sector: green MSMEs and start-ups under 3 years old, MSMEs owned by women or youth, and MSMEs operating in the agriculture, health, education, tourism, and digital sectors.
The project will further support the Palestinian private sector in key segments with high impact on local development.
Investments of this type, demonstrate commitment to supporting Palestine’s sustainable economic development, establishment of a strong and independent economy that can serve as a backbone of a future Palestinian state.