Agriculture accounts for more than 30% of the country’s GDP and employs nearly 80% of the working population. Despite a decrease in poverty, 40% of the population still lives below the poverty line and 57% of the population does not have a bank account.
The institution:
Première Agence de Microfinance – Burkina Faso (PAMF-BF) is a Tier 2 microfinance institution (the size of the portfolio of client receivables is between $10 million and $100 million) created in 2006 by the Aga Khan Agency for Microfinance to promote the financial inclusion of low-income populations.
Impact:
PAMF-BF grants microcredits to finance agricultural and economic activities such as market gardening, cereal production, animal husbandry and small trade in rural and urban areas. The institution has a strong presence in rural areas with 84% of its
portfolio dedicated to financing agriculture. It is characterized by its good practices in terms of client protection.
The Grameen Crédit Agricole Foundation received a loan from the European Investment Bank (EIB) of €12M equivalent in CFA Francs to support the development of microfinance in Western Africa. This financing operation in local currency is a true recognition for the Foundation that will be able to increase its presence in Africa.
The EIB, an operator committed to microfinance
The EIB has a long experience in the development of microfinance. With more than €1.2 billion implicated since the first microfinance operations in 1992, the EIB supports microfinance institutions as well as other actors in this field who promote inclusive and responsible finance. As part of the Cotonou Agreement signed in 2000 between the European Union and the ACP countries (Africa, Caribbean, Pacific), the EIB launched an investment facility to promote the private sector and fight poverty.
Within the framework of this program, a loan a loan of €12M equivalent in CFA Francs was granted to the Grameen Crédit Agricole Foundation.
The Foundation, an expert in the field
As an investor, financer and technical assistant coordinator, the Foundation has supported for 10 years microfinance institutions and social businesses all around the world. At the end of 2018, it recorded a total commitment of € 81 million to 75 partners in over 30 countries. After great results in 2018, this new financing will allow the Foundation to expand its actions to support microfinance and social entrepreneurship in Africa.
With over 30% of its financing in Sub-Saharan Africa, the Foundation positions itself as an actor committed to fighting poverty in the continent. The Foundation targets rural populations to support financial inclusion and to strengthen resiliency in the agriculture sector. The alliance between the EIB and the Foundation serves a common goal: financing and supporting a more sustainable and inclusive economy, in line with the 2030 Development Agenda. By providing this financing in CFA Francs, the EIB allows the Foundation to continue to support its partners in Western Africa through loans in local currency.
In 2018, the Foundation consolidated its presence in West Africa with 8 new loans
In the course of the previous year, the Grameen Crédit Agricole Foundation strengthened its presence in West Africa with 8 new loans, 3 of which to new partners.
In Mali, the Foundation financed Kafo Jiginew, a cooperative network of savings and loans banks that provides retail financial services (savings, loans, microinsurance, transfer of funds and other services) to the largest number of persons in Mali to improve their living conditions. The institution has 48,000 working clients at this time, 92% of whom live in rural areas. The Foundation granted a loan in local currency equivalent to €3 million over five years to this institution.
In Benin, the Foundation granted a loan in local currency equivalent to €1.4 million to a new partner, PEBCo Bethesda which is geared to improving the living conditions of people by providing quality financial and non-financial services. The institution provides loans to groups and individuals. It has ca. 95,000 active borrowers, 64% of whom are women and 33% live in rural areas.
In Togo, the Foundation also financed a new partner, Assilassimé, with a loan in CFA francs equivalent to €500,000. Assilassimé is a programme created in 2012 by Entrepreneurs du Monde for marginalized people. The institution provides them financial (microcredit) and non-financial (training, individualized support, social media optimization) services. It has nearly 30,000 clients at this time, some 97% of whom are women.
In Burkina Faso, the Foundation moreover made three investments in existing partners in 2018, bringing the total amount of its commitments in that country to more than €4 million, or 13.8% of its commitments in Sub-Saharan Africa at the end of December 2018. More specifically, ACFIME received a loan in CFA francs equivalent to €305,000 over a period of three years. This is a microfinancial institution that helps to bridge the gap not covered by large MFIs which operate across the country, with loans granted by ACFIME having a very strong potential social impact. It has 18,600 clients at this time, 90% of whom are women. For its part, PAMF-BF received a loan in local currency equivalent to €1 million over a period of three years. The core activity of the institution, which has some 28,400 clients, is to grant loans in Burkina Faso so as to help meet better the financial needs of low-income segments of the population with reinforced protection or their members or users. Finally, ACEP Burkina received a loan in local currency equivalent to €1.5 million over a period of three years. Acep is a microfinance institution specialized in the financing of microenterprises and very small existing companies in urban centres and their inner suburbs. The credits granted are intended essentially to finance the working capital and investment needs. The institution has 11,000 active borrowers at this time.
Finally, in Senegal, the Foundation granted a loan in local currency equivalent to €762,000 to Caurie Microfinance, a socially responsible and financially viable MFI geared to making a lasting contribution to the economic and social promotion of poor microentrepreneurs, mainly women. Caurie has 71,000 clients at this time, 98% of whom are women. The Foundation has also granted a €100,000 loan to Sénégalaise des Filières Alimentaires in the form of a shareholders’ current account. SFA is a social business which is developing an inclusive value chain from the production and marketing of rice, in which the Foundation has had a shareholding stake since 2013.
For further information on the Foundation’s partners,cliquez here.
The GCA Foundation and the EIB join forces to promote microfinance in Africa
On April 1, the Grameen Crédit Agricole Foundation and the European Investment Bank (EIB) organised, in Paris, a round table debate on the subjectf of the development of rural economies and the strengthening of microfinance in Africa by the EIB. The representatives of both institutions stated a common objective: the promotion of a more sustainable and inclusive economy.
Following the EIB’s grant to the Foundation of a EUR 12 million loan equivalent in CFA francs to support microfinance in West Africa, this round table was also an opportunity to discuss the challenges related to the development of rural areas in Africa. Several guests gathered to discuss rural microfinance, agriculture, gender and climate change.
For the Foundation, the acknowledgement of its expertise in microfinance
As Jérôme Brunel, Director of the Foundation and Secretary General of Crédit Agricole S.A., pointed out in his opening speech, the Foundation has lent more than four times its capital over the past ten years, i.e. €200 million in financing, in over 30 countries and has supported over 100 partners since 2008. At the end of 2018, the Foundation had an outstanding portfolio of €76 million and supported 75 partners in 35 countries. After excellent results in 2018, this new funding will allow the Foundation to extend its action in Africa in the field of microfinance and support to social entrepreneurship. “With this funding to the Grameen Crédit Agricole Foundation, the European Investment Bank confirms its commitment to financial inclusion in West Africa alongside a committed player that has just celebrated its 10th anniversary,” stated Ambroise Fayolle, EIB Vice-President.
Mamadou Lamine Gueye, Managing Director of Caurie Microfinance, a Senegalese microfinance institution partner of the Foundation and beneficiary of the EIB funding, and Soukeyna Ndiaye Bâ, Managing Director of the INAFI International Foundation and a Board member of the Foundation, for their part, spoke of the importance of intermediaries such as the Grameen Crédit Agricole Foundation, whose positioning enables small microfinance institutions to be funded, which otherwise would not be as they are not eligible for funding from large donors. Both agreed to recognize the role of the Foundation and other donors in the development of the African microfinance sector, hence providing opportunities for African youth.
Two institutions have already benefited from the loan granted by the EIB to the Foundation: Caurie Microfinance, whose mission is the social and economic empowerment of poor microentrepreneurs in Senegal, mainly women; and PAMF BF, which offers microloans to finance agricultural and economic activities such as market gardening or cereal production in Burkina Faso. These two institutions alone represent over 110,000 active borrowers, 79.87% of them women.
Africa remains a priority target for the Foundation
Sub-Saharan Africa accounts for around 30% of the Foundation’s funding. It focuses its action in favour of rural populations, with the objective of strengthening the resilience of the agricultural sector. “The Grameen Crédit Agricole Foundation is now present in a dozen African countries,” stated Jean-Marie Sander, President of the Foundation. For Eric Campos, Managing Director of the Foundation, “work on agriculture means to work on the future of Africa. We must free the development of products suited to the rural world: today, agriculture represents 60% of the workforce of the continent. Farmers represent only 3% of the banks’s clients!”
In line with the action undertaken by the Foundation, microfinance is a fundamental pillar for value creation in Africa. This is also what two of our speakers, Flora Helard and Mathilde Thonon, students at Sciences Po Paris and co-founders of In-Venture, found out during their one-year voyage accross West Africa and South-East Asia where they travelled to meet those who find financial solutions to the social and environmental problems of their community. In particular, they met with two MFIs partner of the Foundation in Benin: RENACA and ACFB. Their enthusiasm reflects the performance of a dynamic sector that attracts tomorrow’s young entrepreneurs.
