The World Bank Implementation Status & Results Report Access to Finance for MSMEs (P152307) Access to Finance for MSMEs (P152307) LATIN AMERICA AND CARIBBEAN | Jamaica | Finance, Competitiveness and Innovation Global Practice | IBRD/IDA | Investment Project Financing | FY 2018 | Seq No: 12 | ARCHIVED on 20-Sep-2023 | ISR57852 | Implementing Agencies: Ministry of Finance and the Public Service, The Development Bank of Jamaica Key Dates Key Project Dates Bank Approval Date: 29-Jan-2018 Effectiveness Date: 29-May-2018 Planned Mid Term Review Date: 01-Jun-2021 Actual Mid-Term Review Date: 01-Jul-2021 Original Closing Date: 30-Jan-2023 Revised Closing Date: 31-Jan-2024 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The Project Development Objective (PDO) is to improve access to finance for micro, small, and medium enterprises (MSMEs). Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Enhancement of the Credit Enhancement Facility (CEF):(Cost $5.55 M) Establishment of an SME Fund:(Cost $7.00 M) Improvement of enabling environment for access to finance and Business Development Services for MSMEs:(Cost $1.35 M) Project management:(Cost $1.06 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Moderately Satisfactory Overall Risk Rating Substantial Substantial Implementation Status and Key Decisions The Credit Enhancement Facility (CEF) supported by the project remains a relevant mechanism to incentivize lenders to provide working capital and investment loans financing to MSMEs. The new portfolio scheme began operating in January 2020 and has signed portfolio guarantee agreements with several approved financial intermediaries (AFIs) since then. In addition, the project supports the establishment and the capitalization of an SME fund for risk capital financing to SMEs along with supporting the enabling legal, regulatory and taxation environment for the private equity and venture capital industry. The component responds to the objectives of the GoJ and the DBJ to increasingly give focus not only to facilitating access to credit, but also access to equity, in an effort to provide long term financing solutions for new and existing businesses. The first close of the SME equity fund was completed in June 2022, with a total commitment of US$15 million. 9/20/2023 Page 1 of 5 The World Bank Implementation Status & Results Report Access to Finance for MSMEs (P152307) The Voucher Technical Assistance (VTA) program for the provision of BDS has provided J$52 million (US$345,000) to support 274 MSMEs, and the new voucher for technical assistance platform was launched in February 2022. Procurement: There are 26 procurement activities for an aggregate amount of approximately US$3.4M (23% of the total loan amount). 22 of the 26 cleared procurement activities have been completed, and the three remaining activities are at advanced stages of implementation. Financial management: The project financial management arrangements are adequate and enable the DBJ to generate timely and reliable financial information on implementation. No significant deficiencies were noted in the internal controls of the PIU. Environmental and social (E&S) safeguards: The project E&S safeguards continue to be adequate. Verification visits are being conducted and the ESMF continues to be implemented. The E&S Management System (ESMS) has been finalized and covers the institution’s entire portfolio. E&S reporting has been satisfactory. The project also continues to maintain and monitor its grievance mechanism. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance Substantial Moderate Moderate Macroeconomic High Substantial Substantial Sector Strategies and Policies Moderate Moderate Moderate Technical Design of Project or Program Substantial Substantial Substantial Institutional Capacity for Implementation and Substantial Substantial Substantial Sustainability Fiduciary Substantial Moderate Moderate Environment and Social Moderate Moderate Moderate Stakeholders Moderate Moderate Moderate Other -- -- -- Overall Substantial Substantial Substantial Results PDO Indicators by Objectives / Outcomes The PDO is to improve access to finance for micro, small and medium enterprises (MSMEs) IN01341849 ►Number of SMEs getting access to risk capital through the SME Fund (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 15.00 Date 29-Jan-2018 31-Jan-2023 31-Aug-2023 31-Jan-2024 IN01341850 9/20/2023 Page 2 of 5 The World Bank Implementation Status & Results Report Access to Finance for MSMEs (P152307) ►Number of guarantees issued for MSME loans through the improved CEF (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 78.00 1,525.00 1,720.00 1,178.00 Date 29-Jan-2018 31-Jan-2023 31-Aug-2023 31-Jan-2024 Intermediate Results Indicators by Components Enhancement of the Credit Enhancement Facility (CEF) IN01342003 ►Improvements of the DBJ's institutional capacity in credit risk management of AFIs (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The DBJ has adequate The DBJ has adequate systems and expertise systems and expertise in in place to scale and place to scale and manage the CEF, in a manage the CEF, in a The DBJ has sustainable manner. The DBJ has limited sustainable manner. adequate systems and Additionally A new institutional capacity to Additionally A new CEF expertise in place to Value CEF Division was scale sustainably the Division was established scale and manage the established with a CEF's operations. with a dedicated General CEF, in a sustainable dedicated General Manager and staff along manner. Manager and staff with a MIS and support along with a MIS and from an enhanced risk support from an unit enhanced risk unit Date 29-Jan-2018 31-Jan-2023 31-Aug-2023 31-Jan-2024 Comments: IN01342006 ►Volume of guarantees provided to MSME loans (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 4,412,800.00 80,470,907.00 91,580,113.00 135,954,685.00 Date 29-Jan-2018 31-Jan-2023 31-Aug-2023 31-Jan-2024 Establishment of an SME Fund IN01342002 ►Private capital mobilized (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 10.00 10,000,000.00 10,000,000.00 Date 29-Jan-2018 31-Jan-2023 31-Aug-2023 31-Jan-2024 9/20/2023 Page 3 of 5 The World Bank Implementation Status & Results Report Access to Finance for MSMEs (P152307) Victoria Mutual Investments Limited committed US 10 million to the SME equity fund in June 2022. Comments: IN01342005 ►Volume of risk capital provided to SMEs (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 11,500,000.00 Date 29-Jan-2018 31-Jan-2023 31-Aug-2023 31-Jan-2024 Improvement of enabling environment for access to finance and Business Development Services for MSMEs IN01342001 ►Percentage of beneficiaries that feel project activities reflected their needs (Citizen Engagement Indicator) (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 85.00 86.00 75.00 Date 29-Jan-2018 28-Feb-2022 31-Aug-2023 31-Jan-2024 The last surveys of beneficiaries were conducted in February and March 2023. Comments: IN01342004 ►New business development service platform operational (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No Yes Yes Yes Date 29-Jan-2018 31-Jan-2023 31-Aug-2023 31-Jan-2024 Performance-Based Conditions Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P152307 IBRD-88220 Effective USD 15.00 15.00 0.00 8.92 6.08 59% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P152307 IBRD-88220 Effective 29-Jan-2018 02-Mar-2018 29-May-2018 30-Jan-2023 31-Jan-2024 Cumulative Disbursements 9/20/2023 Page 4 of 5 The World Bank Implementation Status & Results Report Access to Finance for MSMEs (P152307) Restructuring History Level 2 Approved on 15-Sep-2022 Related Project(s) There are no related projects. 9/20/2023 Page 5 of 5