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São Paulo, Brazil, August 22, 2022—Smaller supply chain retailers in the consumer goods industry will have increased access to finance with IFC investing up to BRL 250 million to acquire senior quotas of Tradepay Varejo I, a Fundo de Investimentos em Direitos Creditórios (FIDC) [1] managed by Solis Investimentos Ltda., a leading FIDC fund manager in Brazil.
IFC's support will help promote greater market competitiveness by bolstering competition in the micro, small and medium enterprises (MSMEs) financing market through a capital market solution (i.e. investing in a FIDC). Tradepay exclusively provides funding support to MSME retail clients of large brand name companies which process their supply chain transactions and invoice settlement on Trademaster's (TM) digital platform. TM is an innovative fintech company in the niche market of trade technology in Brazil. Tradepay will use the proceeds of the investment to acquire receivables and credit rights originated mostly by MSME retailers across Brazil.
A key sector for job creation and economic growth in the country, MSMEs have been one of the hardest hit by the COVID-19 pandemic. Yet, according to the SME Finance Forum, managed by IFC, the finance gap for MSMEs in Brazil stands at around US$107 billion, deterring their productivity and growth potential.
"We are confident that IFC's partnership with Tradepay will help reduce Brazil's MSME finance gap amid adverse market conditions, contributing to greater competitiveness and stronger local capital markets through diversification of the FIDC market," says Carlos Leiria Pinto, IFC's Country Manager in Brazil. Carlos added, "This is well aligned with IFC's strategy to improve payment terms for MSME retailers in Brazil while supporting fintech solutions to achieve wider financial inclusion."
Over the last five fiscal years, IFC invested over $3.8 billion in Brazil's financial sector in long-term investments, including mobilization from third parties. IFC has been investing in Brazil's private sector since 1957 to address the country's most critical development challenges, including those of urbanization, social inclusion, competitiveness and productivity, and management of natural resources. About IFCIFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org. Stay Connectedwww.ifc.org/lacwww.twitter.com/IFC_LACwww.linkedin.com/company/ifc-américa-latina-y-el-caribewww.facebook.com/IFCwbgwww.instagram.com/ifc_org/www.youtube.com/IFCvideocastswww.twitter.com/IFC_orgwww.ifc.org/SocialMediaIndex[1] FIDC is a type of receivable investment fund used for securitization purposes; it is regulated by the Brazilian National Monetary Council and the Brazilian Securities and Exchange Commissions.
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