The Foundation continues to support its partners in Asia

© Didier Gentilhomme / Fondation GCA

During the first quarter of 2021, the Grameen Crédit Agricole Foundation completed three new financings in Asia, in particular in Indonesia.

In Indonesia, the Foundation granted a new loan to the microfinance institution KOMIDA for an amount in local currency equivalent to €2.2 million. KOMIDA is a microfinance institution created in 2004 as a foundation to offer financial assistance in the form of savings and loan services as well as non-financial services such as health or family financial management training. The institution, which works exclusively with women, currently serves nearly 720,000 clients.

Also in Indonesia, the Foundation granted a new loan to the microfinance institution MBK for an amount in local currency equivalent to € 5 million. “Mitra Bisnis Keluarga” (MBK) is a microfinance institution regulated by the Indonesian Financial Services Authority (FSA) and licensed as a non-bank finance company. Using the Grameen Bank methodology, MBK provides working capital to low-income women in Java to give them access to formal and profitable financial services (financial inclusion), reduce their vulnerability and improve their lives. To date, the institution serves more than one million clients, exclusively women, 75% of whom below the poverty line.

In Myanmar, the Foundation granted a new loan to Proximity Finance for an amount in local currency equivalent to € 1.4 million. Proximity is a microfinance institution created in Myanmar in 2010 that designs and delivers affordable and income-generating products for rural families. The institution strives to improve the livelihoods of rural Myanmar people by providing innovative financial services tailored to their needs, and uses the dynamism of businesses to create social value. To date Proximity has nearly 200,000 active borrowers, 69% of whom are women and 98% of whom live in rural areas.

To date, the Grameen Crédit Agricole Foundation has 89 partners in 39 countries and manages a portfolio of €86 million, 46% of which is located in so-called fragile countries.

For more information, click here.


Lazika Capital, partner of the Foundation, supports Georgian entrepreneurs

Lazika Capital is a microfinance institution created in 2000 by Oxfam Great Britain in Georgia. Its mission is to facilitate access to financial services for low and middle income entrepreneurs.
Lazika Capital is among the leaders in the Georgian microfinance sector and has nearly 14,000 clients. The agricultural sector represents 52% of its portfolio.

In 2020, in response to the Covid-19 crisis, Lazika Capital provided significant benefits to its clients directly affected by the health and economic crisis. During this period, the Grameen Crédit Agricole Foundation, alongside other lenders, supported Lazika Capital to limit a decline in its liquidity and ensure that the institution could continue to finance its clients. Although the health situation has improved in 2021, the institution remains actively involved in various government programmes to reduce the negative impact of the pandemic and accelerate economic recovery.

Priority to digitalisation

Lazika Capital was the first microfinance institution in Georgia to be allowed, by the National Bank, to offer remote services.

To support entrepreneurs, especially in the agricultural sector, Lazika Capital offers its clients technological improvements to make their products and services more diversified and flexible.
Indeed, the institution uses digital tablets for better application management in the field. This digital offering was particularly useful during the lockdown period, as clients could apply for loans, be informed of their approval and make repayments without visiting a branch.

The positive results achieved in 2020 prove that Lazika Capital is a resilient institution, able to face challenges while continuing to be a successful, reliable and responsible partner in the microfinance sector. The Grameen Crédit Agricole Foundation, on its side, pursues its support to the institution with which it has been working since 2017, in order to continue supporting Georgian entrepreneurship, despite the challenges in this uncertain period.

More information on Lazika here.

Solidarity Bankers: six missions to be filled with the Foundation’s partners

© Godong / Philippe Lissac – Fondation Grameen Crédit Agricole

Two online and four field Solidarity Bankers’ missions are currently available on behalf of the Grameen Crédit Agricole Foundation.

Solidarity Bankers is a skills volunteering programme launched by the Foundation and Crédit Agricole S.A. in 2018 and aimed at all Crédit Agricole Group employees. The programme has a twofold objective: on the one hand, support microfinance institutions and social impact enterprises financed by the Foundation with technical assistance, and on the other hand, enhance the skills of Group employees who want to invest themselves in projects with high social impact.

The missions can take place during the Solidarity Banker’s working time and/or during holidays (volunteering).

Currently, six missions are available, online or in the field:


The experts selected for the online missions will work remotely and will devote the equivalent of one day per week, for 15 weeks, to the mission.

The two online missions are to be filled as soon as possible.

  • “Digital strategy” mission for OXUS (Kyrgyzstan)

OXUS Kyrgyzstan (OKG) is a microfinance institution that provides financial services to the working poor and under-banked in Kyrgyzstan. The institution serves 8,000 active borrowers and manages a portfolio of EUR 6.4 million.

A Solidarity Banker mission is planned from July 2021 to support OKG in the evaluation of its digitalisation processes and in the construction of a new digital strategy. The expert sought is a Crédit Agricole employee with significant experience in IT project management. Fluency in English is essential.

The mission description is available here.

  • “Financial Management” mission in favour of FATEN (Palestine)

FATEN is a microfinance institution in Palestine. The institution has more than 26,000 clients and manages a portfolio of EUR 108 million.

The selected Crédit Agricole expert will support FATEN in updating financial procedures, policies and tools. The Solidarity Banker must be fluent in English and have knowledge of international financial reporting standards and in particular of the latest changes to IFRS 16 and IFRS 9. Fluency or very good knowledge of Arabic is a plus. At a minimum, fluency in English will be required.

The mission description is available here.


The four field missions are to be filled as soon as possible, depending on the current health situation.

  • “Logistical support/purchasing” mission in favour of Oshun (Senegal)

Oshun is a social enterprise that offers inclusive solutions, especially in the form of solar-powered water kiosks, allowing the most vulnerable populations access to clean water. Oshun Senegal is completing a process of administrative and HR structuring and wishes to strengthen its support functions, primarily logistics and purchasing.

The selected Crédit Agricole expert will support Oshun in setting up procedures to simplify and secure logistics, procurement and supply management, and strengthen the staff involved. The mission will last 10 days, first remotely from France and then on the ground in Senegal if health conditions allow. The Solidarity Banker must have solid experience in logistics and procurement management and, ideally, experience in training and coaching in the field of procurement.

The mission description is available here.

  • « LBC-FT » mission for SEF (South Africa)

SEF is a microfinance institution that provides loans through a network of 98 branches in South Africa. The institution has 225,317 active borrowers and manages a portfolio of more than EUR 45 million.

The selected Crédit Agricole expert is responsible for supporting the Quality and Compliance Department and the Training Department in developing relevant training materials on AML/CFT issues for employees. The Solidarity Banker must have at least 5 years of experience in compliance.  The mission will last two weeks, including 10 days in the field.

The mission description is available here.

  • « Marketing » mission for Lazika Capital (Georgia)

Lazika Capital is a Tier 2 microfinance institution in Georgia. The organisation operates through 18 branches in western Georgia.

The selected Crédit Agricole expert will be responsible for evaluating the organisation’s marketing strategy and actions, as well as developing a marketing plan for mid-2021/2020. The Solidarity Banker must have a solid experience in marketing. A good mastery of English is required. The mission will last 20 days, including 10 days in the field.

The mission statement is available here.

  • « Digital Strategy » mission for Smart Credit (Moldova)

Smart Credit is a microfinance institution that provides financial services to socially disadvantaged people and small entrepreneurs in Moldova. The institution has more than 3,000 active borrowers and manages a portfolio of 4.4 million euros.

The Solidarity Banker will be in charge of helping to build the digital strategy of Smart Crédit. The expert is an employee of the Crédit Agricole Group who is fluent in English and has experience in IT project management.

The mission description is available here.

How to apply?

To discover the details of the missions:

  1. Go to the CA Solidaires website: tab “Get involved” then “Solidarity leave“.
  2. Click on the offer of your choice. You will find all the necessary information for your application.

For more information, you can contact:

Microinvest supports investments in the modernisation of Moldovan agriculture

Interview with Dumitru Svinarenco, Chief Executive Officer of Microinvest (Republic of Moldova) about investments in Moldovan agriculture in main facilities of Agri loans.

1. Could you present Microinvest in a few words?

Microinvest is a non-bank credit organization with mixed capital. We managed to prove our major role in the Moldovan financial market by supporting local businesses, agriculture and individuals and directly contributing to the development of the country’s economy.

According to the size of the portfolio, we rank 6th among the banking system, while maintaining the leading position on non-bank credit market in the country. We are different from other financial companies thanks to the customized solutions and important benefits in the lending process that we offer to each client, including agricultural entrepreneurs. We are the only NBFI in Moldova to hold the international quality certificate – SMART, which proves that we are a responsible and trustworthy lender.

2. Agriculture is one of the basic pillars for the Moldovan economy and it is also a priority sector for Microinvest. How did the 2020 drought and Covid-19 affect your clients and your organization?

Every year, the agricultural sector is developing and modernizing thanks to successful entrepreneurs and responsible investments. 30% of our overall LP and more than 40% of our business LP is dedicated to the agri field, to the support of agricultural businesses and farms, which need financial investments for quality agriculture.

The year 2020 had a major impact on the Moldovan agricultural segment, which were directly confronted with the Covid-19 crisis, but also with the unprecedented drought, which led to a season with minimal harvests.

3. What has been your response to support the agricultural sector to cope with these crises?

Microinvest was among the first organizations to cancel the penalties at the beginning of the pandemic, both for business owners and individuals. Throughout this period, our experts have assessed the situation of each entrepreneur. We have been open to come up with solutions for restructuring and extending the terms of loans, without charging fees.

As the pandemic had just started, we continued to lend to farmers so that they could begin the agricultural season as planned. Despite the difficulties, some of our clients have managed to develop successful households and gather great results from the investments made.

4. Microinvest is funded by the Grameen Crédit Agricole Foundation (GCAF) since 2020. How has the Foundation supported your organization during this pandemic?

Microinvest started the interactions with GCAF in 2019 and signed the first loan agreement in May 2020, at the peak of the highest lockdown restrictions imposed by most countries. This first loan from GCAF was an impulse for other lenders, proving that even new lenders believed in our financial stability and in our adequate reaction to crisis. The second loan has already been disbursed in March 2021.
The Foundation maintained transparent communication with us, listened to our needs and supported the search for suitable solutions. We consider GCAF as a reliable partner, therefore we plan to develop and strengthen our cooperation in the future.

5. Which will be your strategic priorities for the years to come? What place have you given to digitalization?

Digitization occupies a special place in our communication and development strategy. We follow a balanced formula: combining digital automation with personal discussions with customers, visits and direct interactions. Entrepreneurs appreciate the expertise and the value of an individual approach which lead to tailer-made financial solutions. At the same time, we tend to go for the massive digitization of retail lines, simplifying the lending process, and thus saving our customer time.

We are confident that agriculture in Moldova is one of the strategic segments for our country. We support individuals and legal entities in their plans for growth and business transformation. In 2021, we came up with a special offer for business clients – unsecured credits up to MDL 1,700,000, so that they can successfully achieve their goals. Both we and the farmers have high expectations for the new agricultural season. A good year will give additional strength to the agricultural sector, but also additional desire to invest in the modernization of agricultural practices, by purchasing new high-performance equipment.

More information on Microinvest.

COVID-19 : The Foundation’s governance during the health crisis


Spotlight on the interview with Sylvie Lemmet, Chairman of the Finance, Risks and Impact Committee, Jérôme Brunel, Chairman of the Compliance and Internal Control Committee, and Bernard Lepot, Chairman of the Investment Committee.

Looking back on the outbreak of the crisis, could you tell us how you perceived it at the time?

Bernard Lepot: We all understood as early as March that we were in unknown territory for an indefinite period of time, with systemic consequences that were difficult to grasp. All continents were affected, including Africa and Asia, where we have most of our activities. The risk of serious difficulties for our partners was likely, with possible large provisions for the Foundation. Despite this lack of visibility, the Board had to define the Foundation’s position quickly, which we summarise as follows: support for our existing partners and consultation with other international lenders.

Sylvie Lemmet: Last March, we were completely in the dark. We felt that the crisis was going to hit developing countries hard and that we were going to face potential bankruptcies and losses for the Foundation. We were worried for our partners.

Jérôme Brunel: I feared that the impact of the pandemic, which I thought would affect developing or less developed emerging countries more strongly (though this has not been confirmed) would weaken the solidity of the Foundation’s counterparties, leading to a substantial amount of provisions. This has not materialised up to now thanks to the resilience of the organisations supported and the coordination and joint actions of the various stakeholders in the inclusive finance sector.

What has been the role of the Committee you chair in this context?

JB: The Compliance and Internal Control Committee has played its role by adapting the internal control system to the increase in Covid-19 risks, organising training on debt restructuring methods, adapting the provisioning policy and collecting more information on the end clients of our counterparties. But to be honest, it was the Finance, Risks and Impact Committee that had the primary role in mobilising the Foundation’s governance to deal with the consequences of the pandemic.

SL: The Finance, Risks and Impact (FRI) Committee already includes the Chair of the Compliance and Internal Control Committee among its members. Last year, we immediately felt the need to make the link with the Investment Committee, and its Chair also sat on the FRI Committee. The development of governance with this ad hoc committee has been extremely positive. It enabled us to build together, and with the Foundation’s Management Committee, a good understanding of the overall situation (the impact on the portfolio, liquidity and margin) and an intervention doctrine, which we developed as the crisis progressed. The objective is to provide the necessary oxygen to our partners while monitoring the risk of default.

BL: Once the roadmap was established, the Investment Committee continued to meet every month, but by videoconferencing, with a reduced number of new projects of course, but with close monitoring of the maturity extensions granted to microfinance institutions that requested them and, more generally, enhanced risk monitoring. The Board also decided to set up an ad hoc committee consisting of the three chairmen of the specialized committees to examine and discuss possible adjustments to the Foundation’s strategy. This body met several times to exchange views with the teams and to provide input to the Board before decisions were made.

What lessons have you learned from this experience one year later, and what prospects do you see for the Foundation in 2021?

SL: One year on, I am above all reassured by the quality of the men and women who make up the Foundation’s executive team and who have been able to respond to an unprecedented situation with great flexibility, professionalism and commitment. We were able to control the financial risks without abandoning our partners in difficulty, and to test the resilience of the organisations we supported, which reassures us as to their quality and as well as the resistance of the microfinance sector to shocks. This is a point that needs to be explored in order to gain a better understanding of the mechanisms that have been implemented locally and the real social impact behind the good financial performance. We all hope for a return to a less chaotic situation and the resumption of activities in 2021. We will have to learn the lessons of remote instructions and juggle with an activity that seems to be picking up though travel remains limited. The pandemic is not yet behind us, but I hope it will remain under control in the countries in which we operate.

JB: The health crisis has shown, first, the solidity of the commitments undertaken by the Foundation, i.e. the judicious choice of its counterparts. Secondly, the quality of the response of the team and its Managing Director to adapt to this unprecedented context, helped by the mobilisation of its Board and its specialised committees. Finally, the Foundation’s commitment to continue its lending activity despite this «hostile» environment and to support microfinance institutions through an international initiative to harmonise the policies of other lenders and a precise dialogue with each of the borrowers.

BL: One year on, it is worth underscoring the remarkable mobilisation and adaptation of the Foundation’s teams, with great collaboration between the various functions. We should also note the great resilience of our portfolio to date, which has perhaps exceeded our expectations. Good information/involvement on the part of the Board has enabled it to express its full support and solidarity with the Foundation’s strategy and actions. Things are still very uncertain for 2021, with perhaps a better visibility in the 4th quarter, but again nothing is certain. Let’s hope that 2021 will be a year of transition that will enable us to resume our development activities in 2022.

Download the 2020 Integrated Report here.


In 2020, the Foundation strengthened its technical assistance activity

By Violette Cubier, TA Manager, Grameen Crédit Agricole Foundation

We continued to develop our third business line in 2020, namely technical assistance for our partners. Our technical assistance missions have contributed to the institutional strengthening and resilience of our partners in this time of crisis.

The Foundation supports its partners through various technical assistance programmes. This support covers a variety of issues such as operations and human resources management, governance, financial management, strategic planning, digitalisation of operations and products, launch of new services, risk management and social and environmental performance management.

The Foundation mobilised to provide close support to its partners throughout 2020. The technical assistance missions were adapted to respond to the priorities and emergencies that the partners had to face (liquidity management and portfolio quality, business continuity plans), but also to support them in their business recovery, their strategic reflections and the transitions necessary to face the crisis (digitalisation, strengthening of activities in rural areas). We also set up joint actions with other actors such as SIDI and the Fefisol fund, with whom we have organised training for some fifty organisations in Africa.

The year 2020 was also marked by a strong development of our technical assistance activities, with an increase in existing programmes and the launch of new programmes. The latter enabled the Foundation to extend the geographical areas of operation in technical assistance and to address more actively key issues such as the development of rural economies, adaptation to climate change or the financial inclusion of refugees.

The coordination of technical assistance activities is now a major focus of the Foundation’s operation for contributing to the institutional strengthening of its partners and supporting them in their economic, ecological and digital transitions, thereby increasing their impact on the ground.

More information: //

Download the 2020 Integrated Report here

Persistent credit risk : a threat to the solvency of microfinance institutions ?

ADA, Inpulse and the Grameen Crédit Agricole Foundation joined forces in 2020 to monitor and analyse the effects of the COVID-19 crisis on their partner microfinance institutions around the world. This monitoring was carried out periodically throughout 2020 in order to gain a better vision of the development of the crisis at the international level. We are extending this work this year on a quarterly basis. The conclusions set out in this article follow the first quarter of 2021. With this regular analysis, we hope to contribute, at our level, to the charting of strategies and solutions adapted to the needs of our partners, as well as to the dissemination and exchange of information by and between the different stakeholders in the sector.

In a nutshell

The results presented in the following pages come from the sixth survey (1) of the joint ADA, Inpulse and Grameen Crédit Agricole Foundation series. The responses from our partner microfinance institutions were collected in the second half of April 2021. The 87 institutions that responded are located in 47 countries in Eastern Europe and Central Asia (EECA-25%), Sub-Saharan Africa (SSA-29%), Latin America and the Caribbean (LAC-25%), South and Southeast Asia (SSEA-13%) and the Middle East and North Africa (MENA-8%) (2).

Whereas the general improvement in the local contexts relating to COVID-19 enables microfinance institutions to conduct their activities better, our latest survey shows that MFIs nevertheless had a lot of difficulties in reaching their development goals in the first quarter of 2021. The reasons cited have mainly to do with the difficulties encountered by the customers of the MFIs. Such customers are reluctant to commit to new loans, and if they do, it is for smaller amounts than in the past. At the same time, their risk profile has deteriorated due to the crisis and the MFIs will find it more difficult to finance them.

This general trend of increasing risk has led to a decline in the quality of the portfolio of the MFIs. In 2020, it has ultimately been reflected in the profit and loss accounts of institutions with an increase in provisioning expenses. This is likely to be the case again this year, with additional reserves but also loan write-offs.

In fact, the operations of the MFIs have been reduced or slowed down, generally with a decrease in the level of their equity capital. In point of fact, one in two MFIs, irrespective of size, indicates a need for capital in 2021. Two trends emerge: the MFIs are counting on their current shareholders to cover the losses linked to the crisis. Conversely, international investors are expected to support their development as of this year. The answers provided by our partners therefore underscore the need for recapitalization this year, which will involve all the players in the sector.

1. Disbursement levels are still low notwithstanding the reduction in constraints

Whereas we have seen a gradual but definite reduction in operational constraints for MFIs since the summer of 2020, this phenomenon continues in the first quarter of 2021. 50% of MFIs in all indicate that the measures in place in their countries are less constraining in April compared to the end of 2020. This is particularly pronounced in Sub-Saharan Africa (64% of respondents in the region) and Latin America and the Caribbean (59%). This is to a lesser extent true for MFIs in Europe and Central Asia, where the situation is either improving or stable. Finally, the situation is opposite in South and South-East Asia, with 45% of respondents in the region reporting a more difficult context, with the Cambodian and Burmese situations weighing on results.

Almost half of the respondents overall report that they no longer face any operational constraints in conducting their activities. This is reflected in the resumption of activity by the MFIs: 52% of those in sub-Saharan Africa can work as before the crisis. The vast majority of MFIs in Latin America are gradually resuming their activities since the first difficulties encountered. The situation in Europe and Central Asia is again divided between gradual or almost complete recovery. Conversely, the deteriorated context for MFIs in the SSEA region is reflected in activities that are either still constrained or are again affected by new measures to contain the epidemic.

Despite these continued positive signals on the level of activity of our partners, the expected level of loan disbursement for the quarter is apparently still difficult to achieve. For example, 55% of respondents report that they did not meet their loan disbursement targets in the first quarter of 2021. Only 10% of respondents exceeded their expectations, while 35% managed to meet their targets. The responses do not appear to pertain solely to business recovery: for example, 80% of MFIs in Sub-Saharan Africa did not meet their disbursement targets in the first quarter, while half report a return to near pre-crisis levels of activity.

When the MFIs did not meet their growth targets at the beginning of the year, three reasons stand out to explain this phenomenon. Firstly, the fact that customers are still reluctant to take out new loans (58% of this group), especially in a still rather uncertain context. Secondly, this is explained by the deteriorating risk profile of customers (50%), who are no longer eligible for loans or are eligible for smaller amounts (38%).

The latter two arguments are also mentioned by MFIs that have reached their targets without exceeding them. Nevertheless, this dynamic is partly offset by the fact that institutions have adjusted to the crisis and have put in place products adapted (digital, targeted sectors, etc.) to the current contexts in order to meet demand (47%).

Finally, the trend is quite different for MFIs that have exceeded their disbursement targets: the main factor is the strong demand received (78%), while the adjustment of the offer (33%) and the increase in the amounts requested (22%) support this trend.

2. A persistent high credit risk continues to have a significant impact on institutions’ profitability

In parallel to these loan disbursement issues, credit risk remains the major challenge for 64% of our partner MFIs, as we have noted since the beginning of our survey series. While late repayments by customers may still be the result of ongoing moratoria (20% of respondents, particularly in South and Southeast Asia and Latin America and the Caribbean), the majority of moratoria exits have resulted in a shift from the “moratorium” portfolio to the “at risk” portfolio, either as unpaid loans or as restructured loans. In total, 61% of the respondents indicate that fewer than 90% of their customers are repaying their loans, and 25% are concerned by repayment rates below 70%.

Another major difficulty is the decline in profitability of MFIs since the beginning of the COVID-19 crisis. At the end of Q1 2021, 55% of our partners raise this point. More specifically, we find that a share of the respondents managed to maintain some profitability in 2020, thanks to certain measures (33% – shown in green in the graph below). We then find a group of institutions (49% – shown in orange) for which an impact on profitability has been felt, but without endangering the institution. Finally, a last group stands out (18% – shown in red), in a less favourable position since the losses incurred in 2020 have direct consequences on the institutions’ own funds. For some of these institutions, this even implies that the company’s capital falls below the minimum levels required by the regulator or financiers.


The provisioning of the portfolio at risk turns out to be the main factor impacting on profitability in fact (61%). For some institutions (26%), this may moreover have led to a breach of contract with their funders. At the same time, there are still few massive loan write-offs, as only 13% of respondents have already resorted to debt cancellation to a greater extent than in previous years.

The impact of credit risk on the profitability of the MFIs is nonetheless expected to continue in the coming months. Loan write-offs in high proportions, above the usual standards, should concern 25% of our partners surveyed. At the same time, 24% expect that the provisioning of the PAR, notably through the exit of the moratorium, will continue to have a strong impact on their financial results. Finally, it should be noted that the ageing of the current portfolio at risk could also lead to additional provisioning expenses.

3. Strained equity capital leads to a search for investors

The decline in profitability, which could consequently continue in the near future without any improvement in credit risk, must be analysed for the short and long term. In the short term, controlling the portfolio at risk is a major challenge to avoid a (further) deterioration of profitability. This then has a direct impact on the operations of the MFIs. According to our partners, this observation has led the majority of the MFIs to revise their growth projections downwards (55%) for the coming years. It is also apparent that risk management involves paying particular attention to the type of activity of clients (31% have suspended disbursements to certain sectors – often tourism, international trade, etc.) and to eligibility criteria (29%). This increased caution reflects the current emphasis on risk management.

The other angle of reflection for the longer-term is the solvency of microfinance institutions in the face of declining revenues or losses. A majority of institutions today (61%) have not taken any action regarding their capital since the beginning of the crisis. Where this has been the case, existing shareholders have provided support to the MFIs, while subordinated debt (Tier 2 equity capital) has also been put in place, to a lesser extent.

A very high proportion of these institutions (48%) nonetheless report an equity requirement in 2021. This sizeable proportion shows the extent of support needed within the sector to ensure its development. There is no real archetype of MFI that emphasizes this expectation of capital support in 2021: regardless of the size of the MFI, about half of each Tier category expresses capital needs.

To meet these capital expectations, The types of shareholders that microfinance institutions wish to turn to in order to meet these capital expectations depend on the reason why this support is needed. For example, for institutions that mention a need for equity support in 2021, we find that when an MFI needs help to cover losses, it overwhelmingly turns to its existing shareholders (83% of cases, 10/12). Conversely, when MFIs are looking for support to continue to grow, they will more often turn to international investors (56% of cases, 14/25), beyond the potential contribution of existing shareholders. Finally, it is worth noting that subordinated debt may be favoured over capital injection, as this option is mentioned by 5 institutions.


All of our partners’ responses therefore suggest that the impact of the crisis, through credit risk, logically creates equity needs for a large proportion of entities, as they face either financial losses or a limitation in their ability to recover. While 41% of respondents say they will focus on improving the quality of their portfolio this year, our partners remind us of the essential role that international and existing investors will have to play in maintaining a satisfactory level of capitalisation that is conducive to their development.


(1) The results of the first five surveys are posted on //, // and //
(2) Number of responding IMFs per region: EECA 22; SSA 25; LAC 22; SSEA 11; MENA: 7.
(3) Tier 1 means that the MFI manages a portfolio of over $50 million. Tier 2 applies to portfolios of $5 to $50 million, and Tier 3 concerns portfolios of less than $5 million.