USAID Launches Rural Financial Inclusion Program in Guatemala
USAID Administrator Samantha Power announced today that, working with Congress, USAID will provide an initial investment of over $6 million to launch a Feed the Future rural financial inclusion program in Guatemala. The announcement was made while the Administrator was in Guatemala to attend the inauguration of President Arévalo.
In line with the objectives of the Biden-Harris Administration’s Root Causes Strategy, this new financial inclusion program will support the new Guatemalan administration’s goal of increasing employment and improving living conditions in rural areas. The rural financial inclusion program is part of USAID’s $72.5 million investment over three years in Guatemala through the U.S. government’s Feed the Future initiative. In addition, USAID highlighted $133.5 million in fiscal year (FY) 2022 development funding recently announced for implementation of the Root Causes Strategy for Guatemala.
By enhancing financial literacy, establishing partnerships with financial institutions, and helping financial service providers reach underserved rural markets with better, tailored products, the project aims to help rural Guatemalans overcome common financial access constraints and will encourage investment in the agriculture sector to improve food security and resilience. The project will focus specifically on vulnerable or underserved populations, particularly women, youth and indigenous communities.
Through the project, USAID will expand Guatemalans’ use of formal financial services such as loans, savings accounts and digital mobile services; increase their savings rates; and help them make more informed decisions regarding their finances. The project also will empower micro, small, and medium enterprises and farmers to access and manage credit and harness remittances sent back to Guatemala to aid in community-level social and economic development. By expanding access to financial services, this program will allow farmers and agribusinesses to increase their incomes and food production, and adopt climate smart agricultural practices that will help them become more resilient to shocks. This program contributes to our economic development efforts under Central America Forward, specifically to build capacity in small- and medium-sized enterprises and assist them to access financing for new investment.