ADA supports Guatemalan MFI Génesis in unlocking climate adaptation financing

Fundación Génesis Empresarial is the largest microfinance institution (MFI) in Guatemala. Certified by Truelift, Génesis focuses on rural development and provides vulnerable people with access to inclusive financial products to improve their living conditions. Génesis meets high social performance standards while maintaining solid financial credentials.

Edgardo Perez Preciado, the CEO of Génesis, explains what differs his organisation from other MFIs: “A high percentage of the Guatemalan population lives in poverty. Our mission is therefore to help people to increase their income, improve their quality of life by improving their housing, giving them access to training and setting up a business. We have development officers, not just loan officers. Each client is situated on a development scale and provided with a tailored pathway towards growth and development. They are supported by the development officers in a holistic manner to ensure they have the necessary skills to succeed in their businesses and to enable them to repay the loans.”

Helping vulnerable people adapt to climate change

ADA and Génesis are currently setting up a two-year project to complement the client development paths with climate adaptation aspects to increase the resilience of vulnerable clients to the adverse effects of climate change. 

Guatemala is particularly impacted by climate change with increasing storms from both the Pacific and the Caribbean as well as a worsening dry corridor. In addition, numerous rivers are contaminated due to deforestation and poor land management. This poses water supply management challenges for households, businesses and farmers.

Edgardo explains that sustainability has been an important aspect of the client development paths for several years and clients are trained in best practices and provided with loans for solar panels and other green solutions such as water filters. However, they were not sure how to make these environmental efforts measurable for each customer to track their development progress.

“ADA will help us to create a climate adaptation taxonomy for our clients to ascertain possibilities for new products and to help us to define climate resilience milestones for our client development journeys. The aim is to make our sustainability efforts more consistent and more measurable, and to increase their contribution to increasing our clients’ resilience.” 

The project with ADA will also help Génesis to access climate finance from international investors and to scale up their adaptation efforts as part of ADA’s Inclusive Climate Finance Initiative. This new programme aims at making enterprises and financial service providers investment-ready to leverage climate financing for developing climate adaptation solutions and for implementing projects.