The G-20 SME Finance Challenge: Unlocking Private Finance for Small and Medium Enterprises
Toronto, Canada (June 26, 2010) The Group of 20 and Ashoka’s Changemakers, with support from the Rockefeller Foundation, launched an online competition today to find the best models worldwide for public-private partnerships that catalyze finance for small and medium enterprises (SMEs). The G-20 SME Finance Challenge, the first ever competition launched by the G-20, is a unique financial inclusion effort aimed at giving small entrepreneurs a chance to grow their businesses.
Today, during remarks to international business leaders at the G-20 Business Summit (B-20), Canadian Prime Minister Stephen Harper announced the competition and pledged $20M from Canada to scale up the winning solutions.
“Small and medium enterprises are the single largest contributor to employment and job creation, in Canada and around the world,” said Prime Minister Harper. “This G-20 initiative will help provide developing countries with the access to financing they need to get their small businesses up and running.”
Only an estimated 20 percent of small firms in low-income countries have access to credit. SMEs are often too small to attract commercial bank or investor interest, but too large to benefit from microfinance products. To date, few scalable solutions to support this “missing middle” tier of businesses have been found.
The G-20 SME Finance Challenge is a unique competition that is asking the private sector to identify path-breaking models that make public programs more effective in leveraging private finance. Private financial institutions, investors, companies, foundations and civil society organizations are all invited to submit proposals. Successful entries will demonstrate: innovation, leverage, scalability, social and economic impact, and sustainability.
“By identifying the best ﬁnancial solutions to support SMEs, the G-20 is playing a critical role in the global ﬁght to create jobs and reduce poverty,” said Rockefeller president Judith Rodin.
The G-20 and Ashoka’s Changemakers invite entries now until August 25, 2010 at changemakers.com/SME-Finance. Details on guidelines and criteria for the proposals can be found on this website.
Up to 15 submissions will be selected as winners. Challenge winners representative of all regions (Africa, East Asia and the Pacific, Europe and Central Asia, Latin America and the Caribbean, Middle East and North Africa, and South Asia) will be invited to the November 2010 G-20 Summit in Korea to be recognized for their innovative ideas. Winners will then be connected with donors and investors at an SME conference in Germany following the Korea Summit.
The G-20 is collectively committed to mobilizing the public share of the funding needed to implement winning proposals from development banks and interested bilateral donors. IFC and the World Bank, the Asian Development Bank, the Inter-American Development Bank Group, the African Development Bank and the European Bank for Reconstruction and Development have all indicated their support for implementing scalable and sustainable SME financing proposals, including those from the Challenge, in partnership with the private sector.
“Ashoka attracts a marketplace for innovation,” said Diana Wells, Ashoka’s President. “We believe that there are a host of unknown brilliant ideas that are providing critical financial support to the best small companies that are changing the world. The G-20 and Ashoka’s Changemakers are committed to finding them and bringing them to the world’s attention.”
About The G-20
The Group of 20 was first established in the wake of the Asian financial crisis of the late 1990s as a meeting of finance ministers and central bank governors. Its goals were to bring stability to financial markets and to promote economic cooperation. Membership consists of advanced and emerging economies from all regions of the globe.
With the onset of the global financial crisis in 2008, the G-20 was seen as the most effective forum to lead global efforts to stem the crisis and mitigate its effects. G-20 leaders gathered on three separate occasions to stabilize the financial system, coordinate national economic policies to steer the world towards recovery, ensure that the international financial institutions were provided with the right underpinnings and adequate resources, and take new steps to increase access to food, fuel and finance among the world's poorest.
Leaders have agreed to meet again in Canada and Korea in 2010. The G-20 Toronto Summit will take place on June 26-27, and the Republic of Korea will host a G-20 Summit on November 11-12. The Canadian and Korean summits will provide opportunities for the G-20 to follow through on its commitments from previous summits and take action to build a future of sustainable and balanced economic growth.
The G-20 countries include: Argentina, Australia, Brazil, Canada, China, France, Germany, India Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, Republic of Korea, Turkey, United Kingdom, the United States of America, and the European Union, who is represented by the president of the European Council, the president of European Commission and the European Central Bank.
About Ashoka’s Changemakers
Ashoka’s Changemakers is an online community of action that connects social entrepreneurs around the globe to share ideas, inspire, and mentor each other. Through its online collaborative competitions and open-source process, Changemakers.com is one of the world’s most robust spaces for launching, discussing, and scaling ideas to solve the world’s most pressing social problems. Changemakers builds on Ashoka’s three decade history and vision for an “Everyone a Changemaker” world by creating a place where the best ideas in social innovation can be shared, refined, and funded. www.changemakers.com │ www.ashoka.org
About the Rockefeller Foundation
The Rockefeller Foundation fosters innovative solutions to many of the world's most pressing challenges, affirming its mission, since 1913, to "promote the well-being" of humanity. Today, the Foundation works to ensure that more people can tap into the benefits of globalization while strengthening resilience to its risks. Foundation initiatives include efforts to mobilize an agricultural revolution in Sub-Saharan Africa, bolster economic security for American workers, inform equitable, sustainable transportation policies in the United States, ensure access to affordable and high-quality health systems in developing countries, accelerate the impact investing industry's evolution, and develop strategies and services that help vulnerable communities cope with the impacts of climate change. For more information, please visit www.rockefellerfoundation.org.
For more information please contact:
Director of Community