Development Finance in El Salvador
BANDESAL
- Second-tier lender: BANDESAL lends mainly through banks, cooperatives and other financial institutions, about 65 of them, which take the credit risk and deal with the client.
- Direct lending: since 2012 it may also lend directly, and a reform of its law allows it to finance up to 80% of a project.
- Funds: it manages the Economic Development Fund (FDE) and the Salvadoran Guarantee Fund (FSG), which provides loan guarantees.
- How to apply: ask your bank whether it offers a BANDESAL line for your sector.
Source: Legislative Assembly: Decree reforming the BANDESAL law (PDF, in Spanish); Legislative Assembly: BANDESAL and its network of financial institutions1,2
The multilateral lenders
| Lender | In El Salvador | Private sector example |
|---|---|---|
| Central American Bank for Economic Integration (CABEI) | Founding member since 1960 with a 10.64% shareholding; 532 operations of more than USD 10,108 million up to 2025, including 3 operations of USD 350 million in 2025 | Listed on the CABEI country page |
| CAF | Full member since 2022; USD 270 million of sovereign approvals in 2025 and a portfolio of USD 989 million | The 2025 approvals reported were sovereign |
| IDB Group and IDB Invest | Country strategy 2025 to 2029 with USD 2,900 to 3,520 million of sovereign approvals | USD 120 million with Davivienda for SME credit (January 2026); up to USD 10 million for the pharmaceutical company Ancalmo (August 2026) |
| World Bank Group and IFC | Public portfolio of USD 2.4 billion and an IFC portfolio of USD 578 million; a joint representation office opened in 2026 | Agricola Debt II, USD 115 million with Banco Agrícola |
Source: CABEI: El Salvador; CAF: Country strategy for El Salvador (PDF, in Spanish); CAF: Annual Report 2025; IDB Group: Country strategy with El Salvador 2025 to 2029 (PDF, in Spanish); IDB Invest: IDB Invest and Davivienda join forces to expand SME credit in El Salvador; IDB Invest: IDB Invest finances the expansion of Ancalmo; World Bank: El Salvador overview; IFC: Agricola Debt II project disclosure3,4,5,6,7,8,9,10
How companies use them
- Small and medium businesses: access is usually indirect, as loans from local banks that draw on BANDESAL lines or on facilities such as the IDB Invest line with Davivienda.
- Larger projects: IDB Invest and IFC also lend directly to companies, as in the Ancalmo loan.
- Disclosure: IDB Invest and IFC publish their projects online, which helps to see which sectors and banks they work with.
Source: Legislative Assembly: BANDESAL and its network of financial institutions; IDB Invest: IDB Invest and Davivienda join forces to expand SME credit in El Salvador; IDB Invest: IDB Invest finances the expansion of Ancalmo; IFC: Agricola Debt II project disclosure2,7,8,10
Frequently Asked Questions
What is BANDESAL?
The state Development Bank of El Salvador (BANDESAL) lends mostly through about 65 local financial institutions and, since 2012, may also lend directly.
Which multilateral lenders are active in El Salvador?
CABEI, CAF, the IDB Group and the World Bank Group. Their private sector arms, IDB Invest and IFC, lend to banks and to larger companies directly.
How can a company get a BANDESAL loan?
Ask your bank whether it offers a BANDESAL line for your sector.
Sources
- Legislative Assembly: Decree reforming the BANDESAL law (PDF, in Spanish)
- Legislative Assembly: BANDESAL and its network of financial institutions (in Spanish)
- CABEI: El Salvador (in Spanish)
- CAF: Country strategy for El Salvador (PDF, in Spanish)
- CAF: Annual Report 2025 (PDF)
- IDB Group: Country strategy with El Salvador 2025 to 2029 (PDF, in Spanish)
- IDB Invest: IDB Invest and Davivienda join forces to expand SME credit in El Salvador (in Spanish)
- IDB Invest: IDB Invest finances the expansion of Ancalmo (in Spanish)
- World Bank: El Salvador overview
- IFC: Agricola Debt II project disclosure
Figures checked 8 November 2026. Prepared by InvestSalvador.com for general information. It is not investment, tax or legal advice; please confirm details with a qualified adviser before acting.
