Our latest member from Central America is part of one of the largest banking groups in the region, BAC International Bank Group, with one of the most extensive branch networks and one of the strongest brands in Central America. BAC San José is the largest private bank in Costa Rica and the most profitable. Javier Sancho Guevara, Corporate Banking and Leasing Manager, spoke to the Alliance about the bank’s decision to join the Alliance, its hopes for the planned Women’s Market program and the role the bank plays in supporting women and SMEs.
GBA: BAC San José has been recognized internationally for its innovative work targeting the SME segment. How did the bank begin to target this segment?
JSG: The SME market had not been a natural target market for us through the years. About 7 years ago, we created a unit to reduce the volume of checks used by our corporate accounts that banked SMEs. Our corporate clients worked with a number of SME suppliers and customers and were interested in improving payment procedures with them to reduce costs and improve efficiencies. After two years, we realized that in addition to cash management services, SMEs were seeking a number of other financial services. This led to the development of a more comprehensive program that specifically targets SMEs.
GBA: How did your interest in targeting the Women’s Market emerge?
JSG: We currently serve more than 26,000 SMEs, 25 percent of which included women-led or women-owned small businesses. In the past, we did not see a need to specifically tailor our products or services to women. We’ve always believed that we cater to a customer without distinguishing whether they are a man or a woman. We thought that there are no differences, but we have since learned through research that there are differences. And then we heard of the GBA and saw some of the know-how on how to develop a more comprehensive program for women, and now we are convinced that there is a business opportunity. We just need to understand more about how to approach it.
GBA: What are your current plans to develop a program to target the Women’s Market?
JSG: We are working with the support of the Multilateral Investment Fund (MIF) of the Inter-American Development Bank (IDB) to develop a pilot that provides women entrepreneurs personalized support for a specific period of time. The Project has two parts: The first one provides women business owners with personal coaches that help them improve their leadership and business skills, and this is complemented by training workshops. The second part is helping us develop the appropriate KPIs for measuring the impact on women’s businesses as a result of our support.
Through this pilot, we also hope to better understand what kind of adjustments we may need to make (if any) to our products and credit policies, how successful our messaging is with women, and whether we are having an impact on women’s businesses. Once we know the results of this pilot, we will be able to develop a more comprehensive offering for women.
GBA: What kind of support services do you currently provide to SMEs? Are these going to be part of your Women’s Market proposition?
JSG: Our financial education program for SMEs is quite extensive. We started with the development of 4 basic modules for business owners, which included understanding financial statements, financial indicators, cash flows, and results. These were taught by bank staff on a regular basis, who volunteered their time, and were held in different branches. The events were so successful that we created an “SME tour,” where we started hiring outside experts on different topics, such as leadership, innovation, sustainability, among many others, and hold seminars in important cities. These seminars are attended by 120-180 people and so are incredibly popular. In addition, our corporate customers realized the incredible business potential these SMEs represented and with our coordination, have started to offer seminars based on their expertise and business practice. Microsoft for instance, offers seminars on cloud-based internet, legal firms offer workshops on labor rights, etc.
In addition, every year we organize an annual seminar called “Seminario BAC PYMES.” More than 500 SMEs in the country participate, and we feature international SME experts on a number of relevant topics such as human resources, sales, leadership, exports, etc. We also organize an annual SME award where we recognize the top SME owners in the country in a number of different categories.
So far, we have not included any topics or awards that are specific to women. However, with the results of the focus group, we hope to be able to incorporate a gender-lens into our already strong offering of financial and non-financial programs.
GBA: What are the main barriers that SMEs face in Costa Rica? Are there any differences between men and women-owned enterprises?
JSG: I don’t believe there are currently any major differences between men and women SME owners in Costa Rica. Most small businesses face the same barriers: lack of collateral, lack of financial information, and a credible business plan, regardless of the gender of the owner. However, we think there may be differences in types of skills and training that is required by women and also think that the bank’s messaging could be improved to be more inclusive.
GBA : BAC is one of the largest and most profitable banks in Central America, with an already impressive market coverage. Why have you decided to develop a program that specifically targets women?
JSG: We have found that women’s credit risk is lower than men’s, and we see that women are seeking more and more economic independence, leading them to start their own businesses. We believe that this translates to not only a business opportunity for the bank, but also a way of creating lasting impact in society through employment generation, which is currently one of the most important priorities for our country. BAC San José is usually a great testing ground for new programs for the BAC Group. Once our pilot is completed, we hope to be able to share with other country heads and expand the work we are doing across the region.
GBA: How did you first hear about the GBA? Why did you decide to join?
JSG: We heard about the GBA through the Multilateral Investment Fund of the Inter-American Development Bank. We also participated in GBA’s study last year “How Banks Can Profit from the Multi-Trillion Dollar Female Economy”, and since then have been discussing internally the possibility of joining the network once we had developed a specific proposition for women. We joined the GBA because we wanted to understand global best practices and benchmarks when developing a Women’s Market program. We know we have many of the elements already in place to develop a strong program, but the richness of experience that we can gain from the GBA will be essential in ensuring the success of the program.
