The Grameen Crédit Agricole Foundation stepped up its support initiated in 2010 for Laiterie du Berger in which it holds 11.5% of the capital, with a new loan in the form of a shareholders’ current account and a new stake in the capital. With this new investment, the Foundation’s overall investment in the Laiterie du Berger comes to €758,000, or 16% of the Foundation’s Social Business commitments.
The Laiterie du Berger is a social business that processes the milk collected from Peul livestock breeders in the North of Senegal into yoghurt and other dairy products sold under the Dolima brand. By ensuring a fixed income for livestock breeders and helping them to improve the productivity of their flocks, the Laiterie du Berger helps to strengthen the local economic fabric and ensure a greater food security for the country which imports 90% of the milk consumed.
Created in 2008, under the joint impetus of the directors of Crédit Agricole S.A. and Professor Yunus, winner of the 2006 Nobel Peace Prize and founder of the Grameen Bank, the Grameen Crédit Agricole SA Foundation is a multi-business operator that contributes to the fight against poverty through financial inclusion and entrepreneurship with a social impact. As an investor, lender, technical assistance coordinator and fund advisor, the Foundation supports microfinance institutions and social enterprises in nearly 40 countries.
As of December 2017, the Grameen Crédit Agricole Foundation recorded € 64.1 million in commitments, including € 57.5 million in funding to microfinance institutions and € 4.8 million invested in social business companies, up 45% compared to the previous year. In 2017, 44 funding projects were approved for a total amount of € 49.3 million. Since its inception in 2008, the Foundation has approved 250 funding projects for a total amount of € 196.5 million.
The Foundation expanded its area of intervention with new partnerships in Montenegro, Kazakhstan and Myanmar. It currently has 69 active partners and operates in 28 countries, 86% of them being among the poorest countries in the world. Forty-eight percent of the investments have been made in sub-Saharan Africa and 23% in South and South-East Asia, both geographical areas representing each 35% of the Foundation’s commitments at year-end. Women and rural populations represent respectively 76% and 81% of the 3 million customers served by the institutions funded by the Foundation, with an average loan granted to the customers amounting to around € 550.
In 2018, the Foundation will pursue its development in new countries by seeking to increase its network of partners whose common point will continue to be a high level of social performance, the financial empowerment of women and the economic development of rural areas.
Amundi, through its solidarity savings funds, invests on behalf of its clients in unlisted, innovative, growing companies with a positive social and environmental impact. This new investment enables Laiterie du Berger, a key player in the dairy sector, to develop and strengthen the resilience of the dairy sector in Senegal.
This investment has been carried out alongside the Grameen Crédit Agricole Foundation, a partner of Laiterie du Berger since 2010 and in which it holds 11.5% capital stake. An international stakeholder in inclusive finance or microfinance services, the Foundation works with a network of nearly 70 microfinance institutions and social companies in some 30 countries, mainly in rural areas. It is through this network that the Foundation contributes to social inclusion by the financing of income-generating activities.
Half of the world’s wealth is held by 1% of the population. The concentration of wealth in the hands of a few people continues to accelerate. This severe and indecent observation challenges one of the foundations of our economic and social belief: no, the law of the markets does not lead to a naturally fair balance; no, the sum of the individual interests does not converge with the best possible general interest. Making the rich richer does not benefit the largest number of people. The so-called “trickle down” effect does not work as effectively as people would like to think. If the proceeds from capital benefit whoever owns it, then growth will never be fairly distributed among all the stakeholders. This proprietary primacy of capitalism ushered in a long period of economic development, but the latter was made possible above all through the exploitation of exhaustible resources. Time is running out .We will not be able to escape the reckoning of the environmental and social consequences of our wealth-creating machine.
Theorized by Professor Yunus, Nobel Peace Laureate 2006, social business, a business model where social utility takes precedence over the capital invested, has been tried as such for some ten years. This model exists also in France. In the older economic paradigm where individualism reigned supreme and its insecurity consequences generalized, the convergence between financial and social performance sounded like a contradiction, a paradox – a utopian whim. And yet, their convergence, however singular it may be, is a path rethinking and refining a more responsible capitalism and a more voluntarily inclusive economy for the future.
Social business is very conventional in its search for profitability. But it is also very different because its primary goal is social utility. Its way of creating sustainable value lies in its capacity to implement a collective utility for which it was created.
The notion of utility as “service rendered to the customer” is inherent in every commercial undertaking. At times the utility has a social dimension, but it remains an efficiency strategy for companies. For its part, a social business exists only by and for its social mission, no longer only in its own interest, but in the interest of society as a whole. This is brought about by a sort of contract it concludes with its eco system – the point of departure for building a common future. Beyond an encounter and an opening which exceed the boundaries of the company, a social business provides positive effects, fairness, and concrete and beneficial changes for the largest number of people.
Impact investments in the form of shareholding stakes in social businesses is a promising yet risky, difficult and patient commitment. The public and investors have long been made complacent by an exciting phantasmagoria. The idea is grand, of course. But the reality is hard. Return on investment is long in coming, at times uncertain, and the projects require constant financial support to develop. Embarking on social business calls for persistence.
Social business undoubtedly harbours the origins of economic change. There are true champions of social businesses but few contenders succeed. Many on the other hand have managed to amplify and disseminate in wondrous fashion a renewed vision of business, driven by an energy and desire to improve alarming social and environmental situations.
The development of social business requires specific financing tools as much as the need to adapt to the conventional financing methods of full service banks. To that end, we have to accept a real economic revolution: the social utility must be booked in the company’s income and financial balance sheet. Conceiving this integration means accepting a real change of paradigm in the treatment of the social economy. It is probably one of the only means to disseminate a socially responsible economic model driven by entrepreneurial dynamism.
Social business could thus post its operational performance more clearly and mobilize conventional bank financing. The path that social entrepreneurship beckons us to follow is that of a world that is asking profoundly to be regenerated. Social business is an expression of capitalism. It is one of its voices, the voice of those who wish to discover new sources of utilitarian entrepreneurship. It is also the path of a liberal economy renewed through a reasonable, responsible and sustainable exploration.
From the very the first pages of their book, Matthieu Dardaillon and Jonas Guyot say: “The future belongs to those who do not resign themselves”. Still full time students in a prestigious business school, the two friends left for three years, to meet social entrepreneurs, enlightened leaders and committed citizens who use their businesses to make a difference in society.
From Europe to Asia and Africa, they speak about their discussions with these “visionaries”: Antonio Meloto, founder of Gawad Kalinga, who fights poverty in the Philippines; Bagoré Bathily, from la Laiterie du Berger in Senegal; or Arnaud Poissonnier, founder of the Babyloan microcredit network … *
From this world tour, they mainly brought back the conviction that it is always possible to act, at one’s own level and on its own way.
_________________________________
* La Laiterie du Berger and Babyloan are partners of the Grameen Crédit Agricole Foundation
The Grameen Crédit Agricole Foundation granted a new loan equivalent to € 1.9 million to the Cambodian microfinance institution LOLC Cambodia, over a three-year period. This loan is the fifth granted by the Foundation to this institution (formerly TPC), a partner since 2010.
With this new loan, LOLC Cambodia, whose mission is to provide entrepreneurs and families at the base of the socio-economic pyramid with economic opportunities to improve their quality of life and their community through the provision of effective and sustainable financial services, represents 55% of the microfinance commitments of the Foundation in Cambodia where it currently has three partner MFIs.
Created in 2008, under the joint impetus of the directors of Crédit Agricole S.A. and Professor Yunus, winner of the 2006 Nobel Peace Prize and founder of the Grameen Bank, the Grameen Crédit Agricole SA Foundation is a multi-business operator that contributes to the fight against poverty through financial inclusion and entrepreneurship with a social impact. As an investor, lender, technical assistance coordinator and fund advisor, the Foundation supports microfinance institutions and social enterprises in nearly 40 countries.
Does microfinance still work? The theme of the 2017 Microfinance Barometer is undoubtedly provocative. The question assumes that microfinance used to “work”, and begs another question: work in what way, exactly?
The question is not new. A lot of efforts (and money) have gone into trying to prove the impact of microfinance over the last two decades, with relatively little success. Methodological issues, high costs and lack of applicable results have led many to abandon efforts to “prove” impact, and focus instead on how to “improve”. This approach is known as social performance, based on the idea that for microfinance to “work”, you need to define what it means (i.e. your social goals) and measure your progress.
Today, the microfinance sector has an objective framework to assess and benchmark social performance. By May 2017, the audit tool had been used by more than 300 institutions in nearly 90 countries, creating a database of social performance scores that can be used for benchmarking.
SPI4 benchmark reports have helped the Responsible Microfinance Facility (funded by AFD), Opportunity International, ACEP, and investors such as REGMIFA, FEFISOL, GCAMF and I&P identify social risks and define targeted technical assistance.
The Grameen Crédit Agricole Foundation has granted a new loan in local currency equivalent to € 2.1 million to the Indonesian microfinance institution Komida, over a three-year period. This loan is the fourth granted by the Foundation to Komida, a partner since 2011.
With this new investment, the Foundation’s commitments to Komida as of end of December 2017 amount to € 3 million that is 68% of the commitments of the Foundation in Indonesia, where it currently has three partners. Komida is a microfinance institution that began offering microloans in 2005 to communities affected by the tsunami in Banda Aceh. The institution exclusively targets women following the Grameen Bank model.
Created in 2008, under the joint impetus of the directors of Crédit Agricole S.A. and Professor Yunus, winner of the 2006 Nobel Peace Prize and founder of the Grameen Bank, the Grameen Crédit Agricole SA Foundation is a multi-business operator that contributes to the fight against poverty through financial inclusion and entrepreneurship with a social impact. As an investor, lender, technical assistance coordinator and fund advisor, the Foundation supports microfinance institutions and social enterprises in nearly 40 countries.
In Côte d’Ivoire, deposits in microfinance institutions (MFIs) grew by 347% over a five-year period, from FCFA 72 billion in 2012 to 250 billion by the end of September 2017, according to figures from the Ministry of Economy and Finance.
This trend was accompanied by a growth in outstanding credit over the period, which amounted to FCFA 250 billion compared to FCFA 57 billion in 2012, reflecting the renewal of the sector, affected by the decade of crisis the country has been through between 2002 and 2010. These figures confirm the results of a study by the Oxford Business Group (OBG), which indicated last June that the MFI customer base had more than doubled between 2014 and 2016 to reach 1.17 million accounts with deposits by the order of FCFA 210 billion (2016), up 66.5% over the period.
The microfinance sector has therefore registered a renewed dynamism, in line with the Ivorian economic upturn in recent years. […] With a banking penetration rate of 34%, including MFIs, microfinance’s development margin remains in relation to the 40% banking penetration rate in Ghana and the 75% in Kenya, according to OBG. By the end of March 2017, there were 53 microfinance institutions in Côte d’Ivoire.
The Grameen Crédit Agricole Foundation has granted a first loan in Indonesian rupiah for a total amount equivalent to € 840,000 over a three-year period, to the microfinance institution KSP TLM.
KSP TLM is a microfinance institution that was created in 2011 by TLM Foundation whose mission is to support local communities through the provision of business development initiatives and related services based on the group lending methodology. KSP TLM serves community loans through the “SeSama” group (perSekutuan uSaha bersaMa), a group of women. This loan product is aimed at supporting female members who run microbusinesses mainly in rural areas. TLM offers also saving facilities and training programmes.
With this new investment, the Foundation now has three partners in this country, which represents, by the end of December 2017, 21% of the Foundation’s microfinance commitments in the South and Southeast Asia region.
Created in 2008, under the joint impetus of the directors of Crédit Agricole S.A. and Professor Yunus, winner of the 2006 Nobel Peace Prize and founder of the Grameen Bank, the Grameen Crédit Agricole SA Foundation is a multi-business operator that contributes to the fight against poverty through financial inclusion and entrepreneurship with a social impact. As an investor, lender, technical assistance coordinator and fund advisor, the Foundation supports microfinance institutions and social enterprises in nearly 40 countries.
