The World Bank's private finance arm and Goldman Sachs teamed up on Wednesday to launch a $600 million fund to increase access to capital for female entrepreneurs in emerging-market countries.
The partners will invest a total of $132 million to seed the new Women Entrepreneurs Opportunity Facility, billed as the first global finance fund exclusively aimed at women-owned small and medium enterprises (SMEs).
The International Finance Corporation, an arm of the World Bank which focuses on the private sector, will provide an initial $100 million and the Goldman Sachs Foundation will invest $32 million.
The fund will allow about 100,000 women to gain access to capital, helping them to overcome a major hurdle to growing their businesses, they said.
According to IFC estimates, about 70 percent of women-owned SMEs in developing countries are either not served or underserved by financial institutions. The resulting credit gap was valued at about $300 billion.
The fund, which will be managed by the IFC, was expected to attract $468 million from public and private investors. It will extend lines of credit and share risks with local banks to promote credit access for female entrepreneurs.
The World Bank said the project was part of its overall strategy to promote gender equality and social and economic opportunities for women.
"This new initiative will create opportunities for tens of thousands of female entrepreneurs to thrive and prosper," World Bank President Jim Yong Kim said in a statement.
"We cannot afford to exclude half of the world's population from their rightful role in helping to change the face of the globaleconomy.
Goldman Sachs, the powerful Wall Street investment bank, said the partnership deepens the commitment of its 10,000 Women educational program that promotes female entrepreneurship.
"Through the experiences of the 10,000 Women graduates, we have seen first-hand that investing in women is a key source that leads to economic growth, but there is clearly more that can be done," Lloyd Blankfein, Goldman Sachs chairman and chief executive, said in the statement.
The Goldman Sachs Foundation also will provide $18 million in grants -- $11 million of which will go to the IFC -- to provide advisory services for banks and female borrowers.