According to the International Finance Corporation (IFC), the financing gap for formal micro, small and medium-sized enterprises (MSMEs) in Mexico is estimated to be about USD 164 billion, more than six times the credit supply for this segment, limiting the growth potential of these enterprises.

The financing gap is larger for MSMEs owned or led by women due to prevailing gender biases in lending. Mexican financial technology firm Konfio is effectively eliminating gender bias by using equitable algorithms to make lending decisions based solely on the credit risk of female applicants.

IDB Invest, together with Konfio, conducted a study to measure the impact that access to credit has on MSME sales growth. The results of the study conclude that after two years of receiving a loan, Konfio’s clients’ sales growth was almost 20% higher than that of similar businesses that were rejected for financing. This difference is even greater, up to 42%, among women-led businesses.