The International Finance Corporation (IFC), a member of the World Bank Group, signed a collaboration agreement with Galgo, a company focused on the digital sale and financing of motor vehicles in Latin America, with the objective to increase and strengthen access to credit for the most vulnerable segments of the population, especially migrants and people without banking history.
Founded in Chile, Galgo is a Fintech with operations in Chile, Peru, Colombia and Mexico dedicated to granting digital loans to low-income sectors to purchase motor vehicles, mainly motorcycles, that allow them to find employment and raise their quality of life. The collaboration agreement contemplates the participation of IFC to identify and prioritize the needs of sectors generally neglected by traditional banking, such as migrants, the base of the pyramid, the informal economy and potential clients with limited or non-existent credit history.
Diego Fleischmann, CEO of Galgo, explained: "We are very happy with this agreement, since it's the first step to eventually explore funding possibilities for our credit operations in Latin America, and contribute to the development of thousands of families in the countries in which we operate by allowing them to buy a motor vehicle that improves their quality of life."
IFC's advisory includes the review of risk reduction models to serve the lower-income population, as well as the definition of roadmaps for product improvement in the short, medium and long terms. The first phase of the agreement will be executed mainly in Peru, although with plans for being implemented in the rest of the countries where Galgo operates.
Manuela Adl, IFC´s Senior Country Manager, Argentina, Chile, Uruguay, and Paraguay, noted: "IFC will help Galgo consolidate its purpose of helping thousands of people acquire a vehicle to use as a work tool or means of transportation in their daily lives. The lack of access to one's own motor vehicle constitutes a barrier to the development of segments that do not find credit opportunities in the traditional system. With this innovative alliance, IFC promotes its inclusion strategy in Latin America."
