Loan of €1.5 M*
(equivalent in local currency)
*Outstanding amount at grant value
Benin’s economy is heavily dependent on informal re-export and transit trade with Nigeria (estimated at 20% of GDP) as well as on agriculture. Women are penalized by a lack of access to economic opportunities and are under-represented in senior positions.
RENACA is a Tier 2 microfinance institution created in 2005 by the NGO CBDIBA to strengthen significantly the economic base of vulnerable rural, peri-urban and urban self-employed populations.
RENACA aims to strengthen significantly the economic base of vulnerable rural and urban self-employed populations by providing them with financial and non-financial services. The institution encourages its members to save. Such deposits are then used to feed a common fund, which provides a basis for granting credit to small producers.
The Foundation grants 7 new fundings in sub-Saharan Africa
During the first half of the year, the Grameen Crédit Agricole Foundation has granted seven new fundings in sub-Saharan Africa to historic partners.
In Benin, the RENACA microfinance institution received a loan in local currency equivalent to € 762,000 over a three-year period. RENACA is a mutual microfinance institution whose mission is to significantly strengthen the economic base of rural populations. To date, the institution has 27,000 active borrowers, 80% of whom live in rural areas and 59.5% of whom are women.
In Kenya, the Foundation granted a new loan in local currency equivalent to € 2 million to the microfinance institution Musoni. Musoni Kenya is a microfinance institution that leverages Information Communication Technology (ICT) heavily to manage its operations efficiently and to scale rapidly. To date, the institution has 44,000 active borrowers, 66.3% of whom are women and 63.3% of whom live in rural areas.
In Uganda, ENCOT received a new loan in local currency equivalent to € 296,000 over a three-year period. This loan was made within the framework of the African Facility, a programme developed by the Grameen Crédit Agricole Foundation in partnership with the French Development Agency to support small microfinance institutions in sub-Saharan Africa. ENCOT is an indigenous rural community development microcredit and rural-enterprise development NGO whose goal is to provide financial and enterprise development services. To date, the institution has 6,200 active borrowers, 56% of whom are women and 88.4% live in rural areas.
Similarly, in the Democratic Republic of Congo, the Foundation granted a loan equivalent to € 540,000 within the framework of the African Facility, to the microfinance institution Paidek, an institution whose role is to finance the development of small commercial or livestock-raising activities. To date, Paidek has 15,500 active borrowers, 51% of whom are women and 31.2% of whom live in rural clients.
In Zambia, the Foundation also provided a new loan in local currency equivalkent to € 300,000 over a three-year period to Agora Microfinance Zambia (AMZ), within the framework of the African Facility. AMZ is a microfinance institution which targets specifically people with low incomes through suitable financial products. To date, it has 37,100 active borrowers, 58% of whom are women and 85% of whom live in rural areas.
Finally, in Senegal, the Foundation has made two new investments. A first investment was made with the microfinance institution CAURIE in the form of a loan, for an amouint in local currency equivalent to € 1.14 million over a four-year period. Caurie Microfinance’s mission is to contribute to the economic and social improvement of poor microentrepreneurs. The institution now has 72,200 active borrowers, 99% of whom are women. 55% of Caurie’s customers live in rural areas. The second investment made by the Foundation in this country was made in the form of an equity investment to Laiterie du Berger for an amount equivalent to € 99,700. La Laiterie du Berger, of whom the Foundation has been a shareholder since 2010, is a social company that collects milk from Fulani herders, in the North of the country, and transforms it into yogurts and other dairy products that are sold under the brand Dolima.
With these new investments, the Foundation raises the amount of its commitments in Sub-Saharan Africa to nearly € 41 million, that is 41% of the total amount of the Foundation’s commitments as of end of August 2019.
Further information : Organisations soutenues
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.
The Foundation works for inclusive finance in Africa
By Mathilde Thonon and Flora Helard, In-Venture
In Benin, more than half of the population lives in rural areas, far from the cities where most traditional banking services are concentrated.
For many Beninese, it is both difficult to save and to take out a loan. Due to a lack of income and sufficient guarantees, rural people, but also women and young workers, are often deprived of the means of financing that could help them to start an activity and contribute to Benin’s economy. To compensate for the exclusion of these populations, microfinance institutions such as RENACA or ACFB have been set up throughout the country.
The Grameen Crédit Agricole Foundation, an actor committed to inclusive finance in rural areas, supports RENACA and ACFB in their mission to promote financial inclusion and entrepreneurship in Benin. Through its financial and technical support, the Foundation helps “to restore hope to communities and to bring people out of a situation of vulnerability,” explains Dieudonné Nganvo, director of RENACA. By offering savings, credit or insurance products adapted to disadvantaged populations, microfinance institutions offer an alternative to traditional banks and promote more inclusive and sustainable finance.
RENACA and ACFB, partners involved in the field
Created in 2008, the Réseau national des caisses villageoises et de crédit autogéré (RENACA) is one of Benin’s most active microfinance institutions. Since 2012, the Foundation has been supporting this mutualist network, which has nearly 145,000 member clients, 60% of whom are women. Present in 6 of the country’s 12 regions, RENACA offers its clients individual and group loans and non-financial services such as personal and professional financial management training. RENACA’s social performance is an indicator of success, as is its financial performance. The institution attaches great importance to its customer relations and regularly monitors its contractors to ensure that they gradually and permanently emerge from economic uncertainty.
The Association des caisses de financement à la base (ACFB) was created by a research and action NGO for the promotion of development agriculture, which initially subsidized women to help them start an economic activity. In order to perpetuate its impact, the NGO preferred the microfinance solution to that of subsidies and gave way to the ACFB in 2004, which is now present in 44 of the country’s 117 municipalities. Since 2016, the Foundation has been supporting ACFB in its missions to promote women’s entrepreneurship and the economic inclusion of the territories.
Based on the model of the Grameen Bank of the Nobel Peace Prize winner, Muhammad Yunus, ACFB specializes in group credit. The latter allows people without individual guarantees to borrow since in exchange the group must undertake to repay if one of the members is unable to do so. The mechanism therefore derives its effectiveness from the bonds of trust and solidarity that exist between members and that encourage repayment: ACFB now has a reimbursement rate of around 100%.
Promoting inclusive finance in Africa: a top priority
Relationships of trust and proximity with customers, encouraged by the establishment of numerous counters throughout the territory, are also at the root of the success of ACFB and RENACA, which together have helped several hundred thousand Beninese people to secure a better future. With the support of the Grameen Crédit Agricole Foundation, the two microfinance institutions have enabled the development of many sustainable economic activities in sectors such as agriculture, access to water, renewable energies, crafts and education in rural areas.
The Foundation works to develop inclusive finance beyond Benin’s borders. Today, it concentrates 35% of its commitments in sub-Saharan Africa and is present in a dozen African countries. Africa will continue to be a priority for the Foundation, which will concentrate 45% of its commitments in the continent by 2022.