Mexican private sector, IDB agree $12 billion loan scheme

MEXICO CITY (Reuters) - The Inter-American Development Bank (IDB) and a major Mexican business lobby on Sunday announced a program to provide up to $12 billion in loans a year to small and medium-sized businesses in the country to help deal with the coronavirus crisis.

IDB Invest, the group’s private sector arm, and the Mexican Business Council (CMN), a lobby representing the country’s top business magnates, said in a joint statement the plan was supported by Mexico’s finance ministry and aimed to help some 30,000 firms.

The accord sought to build a $3 billion program in reverse factoring lines of credit that would complement schemes that IDB Invest already runs in Mexico, the statement said.

Via a revolving credit averaging 90 days in duration, annual financing of up to $12 billion in either Mexican pesos or dollars would be made available, it added.

“IDB Invest will seek the collaboration and support of local commercial banks, international investors and development banks to mobilize additional resources with the aim of expanding the reverse factoring lines,” the statement said.

Reporting by Dave Graham; editing by Diane Craft