A technical assistance programme to strengthen the impact of microfinance in West Africa
Actors committed to microfinance
With almost 12 years of experience in the microfinance sector and over €200 million in funding, the Grameen Crédit Agricole Foundation finances and supports with technical assistance microfinance institutions worldwide. This support aims at promoting sustainable and innovative microfinance services which, in turn, will have positive social and economic impacts for low-income populations and the development of small and micro enterprises.
With 37% of its investments in Sub-Saharan Africa, the continent is at the heart of the Foundation’s action and its mission to contribute to the fight against poverty. Alongside the European Investment Bank (EIB) and the Luxembourg Government, the Foundation will strengthen its support to microfinance institutions in West Africa, within the framework of a new technical assistance programme.
Both partners of the Foundation have strong experience in the development of microfinance: the EIB has already committed over € 1.3 billion for the sector since its first microfinance operations in 1992, a key objective of EIB support for private sector investments in Africa, and Luxembourg concentrates 61% of global assets under microfinance management.
Strengthening the impact of the Foundation in West Africa
After granting in 2018 to the Grameen Crédit Agricole Foundation a loan equivalent to €12 million euros in CFA francs, in order to support microfinance in West Africa, the EIB allocated, on behalf of the Government of Luxembourg, a grant of € 332,000 to provide technical support to five microfinance institutions supported by the Foundation.
This two-year programme will allow the Foundation to support Caurie (Senegal), Kafo Jiginew (Mali), Graine (Burkina Faso), ACEP Burkina Faso and ACEP Niger in order to facilitate their digital transformation, improve risk management or even strengthen the social performance management. Thanks to this partnership with the EIB and the Government of Luxembourg, the Foundation is increasing its presence in West Africa and strengthening its value proposition to its partners in the region. This will strengthen the impact of microfinance in rural and urban areas of West Africa, including in the Sahel States. Moreover, consolodating private sector access to finance will be key to bolster Africa’s resilience and recovery from the expected impact of the Corona virus.
The Grameen Credit Agricole Foundation invests in three new countries
In the first half of 2019, the Grameen Crédit Agricole Foundation made new investments, including three in new countries. For the first time, it funded the LAPO microfinance institution in Sierra Leone for an amount equivalent to € 385,000. LAPO’s mission is to provide financial services that meet the needs of economically active people in a cost-effective and innovative way. It is an MFI that is committed to developing the microfinance industry in Sierra Leone based on microfinance best practices and enhancing the microfinance sector in relation to further developing a credit culture. To date, the institution has nearly 22,000 active borrowers, 97.3% of whom are women. 74% of its clientele is located in rural areas.
The Foundation has also made an initial financing equivalent to € 500,000 to the Nigerian microfinance institution ACEP Niger. ACEP Niger is an MFI specialised in financing very small businesses in urban areas. It manages loans and savings products for urban and peri-urban small and micro-enterprises rejected by the traditional banking system. In accordance with its corporate social responsibility focus, ACEP Niger has adopted the SMART Campaign Client Protection Principles. It thus protects its borrowers against over-indebtedness. To date, the institution has nearly 4,000 clients, about 25% of whom are women. The entire ACEP Niger clientele is located in urban areas.
Lastly, the Foundation also granted a first loan worth € 493,000 to VisionFund Rwanda, a microfinance institution, subsidiary of VisionFund International whose mission is to provide financial and non-financial services to underprivileged rural communities. VisionFund Rwanda serves vulnerable women with children and youth in rural areas and provide them with economic empowerment opportunities. Its products and strategy are focused on strengthening and providing financial services to Village Savings and Loans Associations (VSLAs) and groups. To date, the MFI has close to 12,000 active borrowers, 62% of whom are women and 85% of whom are located in rural areas.
With these three new investments, the Foundation is today active in 16 sub-Saharan Africa countries.
