When it comes to housing in Latin America and the Caribbean, the main deficit is not the quantity of homes available but rather their quality (IDB, 2019). Many low-income families end up in informal settlements on public lands, building their homes in vulnerable areas, with inadequate building and sanitary standards that put their health and safety at risk. Affordable housing is a major challenge in many cities and accessing reasonable financing options for making home repairs and improvements is often out of reach.

An IDB Invest project in Costa Rica (CR-L1073) set out to address housing quality deficits in partnership with the country’s second largest non-profit mutual association (Mutual Cartago de Ahorro y Préstamo). The project aimed to expand access to home improvement loans for 1,250 households, half of which would be low- income families (representing the base of the pyramid), a population segment that the financial institution was targeting. From 2015 to 2019, the project surpassed its loan target by 60 percent. Moreover, about 80 percent of the home improvement loan portfolio served low- income clients, far exceeding the project’s initial target of 50 percent.