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Small Business, Big Growth: How Investing in SMEs Creates Jobs

This report aims to capture the key constraints that SMEs typically confront and provide a methodology better suited to measuring the job creation effects of SME finance initiatives by DFIs like IFC.

IN SUMMARY

  • This report examines the relationship between SME loan size and job creation.
  • Every $1 million loaned to SMEs in developing countries is associated with the creation of an average of 16.3 direct jobs created over two years.
  • Extrapolating from the model shows that lending activities by IFC’s clients was related to the creation of an estimated 4.7 million to 6.1 million jobs in 2018.

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