Small business owners often lack the collateral required by banks for loans. But many small and growing businesses do have another valuable asset: cashflow.

A pilot project in Nicaragua is testing an innovative loan structure that relies on companies’ cashflow to unlock financing for small- and medium-sized enterprises. The test of the new Variable Payment Obligation, or VPO, is aimed at helping women business owners in particular, who often lack fixed assets or loan guarantors. As a result, women entrepreneurs receive only 16-18 percent of financing for “SGBs” — small and growing businesses — in emerging markets.