The Foundation makes five investments in Africa

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© Didier Gentilhomme

During the first quarter of 2019, the Grameen Crédit Agricole Foundation intensified its presence with its African partners by granting five new financings, notably in the form of senior loans. As of the end of March 2019, it had 40 partners in Sub-Saharan Africa, representing 42% of the total outstanding amount.

The Foundation thus granted, as part of the African Facility program, a local currency loan equivalent to €800,000 to the microfinance institution Eclof Kenya, which offers financial and non-financial services to micro, small, and medium-sized enterprises in the country, while actively promoting savings. To date, the institution, which finances 58% of women, has more than 30,000 clients, 60% in rural areas.

Also in East Africa, the Foundation also granted a new loan in local currency equivalent to €1 million to UGAFODE, a Ugandan microfinance institution whose primary mission is to provide its clients with affordable primary financial services. The institution currently has 17,300 clients, including nearly 201,000 women and approximately 801,000 rural clients.

In West Africa, the Foundation granted a new loan to the Togolese microfinance institution Coopec Sifa for €305,000 in local currency. Coopec Sifa, which is financed under the African Facility, is a microfinance institution that offers small loans to its nearly 38,000 clients, primarily women (86%) in the north of the country.

In addition, ACEP Burkina was also granted a new loan of €2.3 million in CFA francs. This microfinance institution, a partner of the Foundation since 2016, specializes in financing microenterprises and very small businesses in urban centers and inner suburbs. It currently has 12,300 clients, including 20% women.

Finally, in Senegal, the Foundation strengthened its partnership with Laiterie du Berger, in which it has been a shareholder since 2010, by granting a loan in the form of a shareholder current account, for an amount in CFA francs equivalent to 229,000 euros. Laiterie du Berger is a social enterprise that recycles milk collected from Fulani herders in the north of the country, transforming it into yogurts and other dairy products sold under the Dolima brand.

To learn more about the Foundation's partners, click here.

EIB grants €12 million loan to Grameen Crédit Agricole Foundation

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© EIB

The Grameen Crédit Agricole Foundation has received a €12 million loan from the European Investment Bank (EIB) equivalent in CFA francs to support the development of microfinance in West Africa. This funding in local currency is a true recognition for the Foundation, which will be able to expand its presence in Africa.

The EIB, a committed player in microfinance

The EIB has extensive experience in developing microfinance. With over €1.3 billion committed since its first microfinance operations in 1992, it supports microfinance institutions and other sector stakeholders promoting inclusive and responsible finance. Under the Cotonou Agreement signed in 2000 between the European Union and the ACP (African, Caribbean, and Pacific) group of countries, the EIB launched a Microfinance Investment Facility to promote the private sector and combat poverty in West African countries. It was under this program that a €12 million loan, equivalent in CFA francs, was granted to the Grameen Crédit Agricole Foundation.

The Foundation, an expert in the sector

As an investor, financier, technical assistance coordinator, and fund advisor, the Foundation has been supporting microfinance and social business institutions around the world for 10 years. Ten years later, it has raised more than €200 million in financing, a presence in some thirty countries, and more than 100 partners supported since its inception. In 2018, the Foundation managed €73 million in outstanding loans, and supported 75 partners in 35 countries. Following its successful results in 2018, this new funding will allow the Foundation to expand its work in Africa around microfinance and support for social entrepreneurship.

With more than 30% of financing in sub-Saharan Africa, the Foundation is positioning itself as a committed player in the fight against poverty on the continent. It focuses its action on rural populations to support financial inclusion and strengthen the resilience of the agricultural sector. This alliance between the EIB and the Foundation meets a common objective: to finance and promote a more sustainable and inclusive economy, in line with the Global Development Agenda by 2030. By providing this financing in CFA francs, the EIB allows the Foundation to continue supporting its partners in West Africa with loans in local currency.

Projects already underway

Two institutions will already benefit from this joint support: CAURIE MICROFINANCE in Senegal, which contributes sustainably to the social and economic empowerment of poor micro-entrepreneurs, primarily women; and PAM BF in Burkina Faso, which provides microcredit to finance agricultural and economic activities, such as market gardening and grain production. These two institutions have nearly 100,000 active borrowers between them.

“With this financing, the European Investment Bank confirms its commitment to financial inclusion in West Africa alongside a committed player that has just celebrated its 10th anniversary,” explained Ambroise Fayolle, Vice-President of the EIB. “The ability to finance this operation in local currency is a key element in reaching the most vulnerable populations without imposing foreign exchange risk on microfinance institutions. We particularly support the Grameen Crédit Agricole Foundation in its efforts to promote women’s employment. It is these values upheld by Europe that we are supporting today.”

“The EIB loan allows us to multiply the Foundation’s action, which concentrates more than a third of its financing in sub-Saharan Africa and is present in a dozen African countries. Africa will continue to be a priority target for the Foundation, which will concentrate more than 30% of its financing in the continent by 2022. Thank you to the EIB for being part of the human and entrepreneurial adventure that Crédit Agricole and Professor Yunus began 10 years ago,” said Jean-Marie Sander, President of the Grameen Crédit Agricole Foundation.

Philippe Guichandut spoke at the Bank of France

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©Philippe Lissac / Godong

From March 11 to 15, the Banque de France organized the seminar "Consumer Protection, Financial Inclusion and Education." The objective of this seminar was to highlight the missions carried out by a central bank in the areas of financial services consumer protection, financial inclusion, and financial education. These missions aim to improve consumer information, provide assistance in the event of difficulties, or prevent or resolve them. Generally carried out in accordance with laws and regulations specific to each country, these activities were compared with the approach adopted in this area by other central banks.

The topics covered were:

– Control of the commercial practices of banks and insurance companies,
– General presentation of the role of the Banque de France in the area of relations between individuals and the financial sphere and the legal protection provisions,
– The organization of relations between the banking sector and consumer organizations,
– Files of general interest managed by the Banque de France and concerning individuals,
– Public information and banking mediation in France,
– The treatment of household over-indebtedness,
– Financial inclusion and financial education.

Roundtable discussions were organized to allow for the exchange of information and experiences between participants, notably through short presentations on their national issues. Philippe Guichandut, Director of Inclusive Finance Development at the Grameen Crédit Agricole Foundation, was invited to speak and present the Foundation's work, before discussing best practices with the other guests.

AMK Microfinance Receives Truelift Leader Milestone

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© Philippe Lissac

Truelift recognized the pro-poor performance of AMK Microfinance Institution Plc, a partner of the Grameen Crédit Agricole Foundation in Cambodia, at the Leader Milestone. This brings to 33 the number of financial service providers recognized along the Truelift Pro-Poor Pathway and to seven the number recognized at the Leader Milestone, the most advanced of the four milestones. What all the recognized institutions have in common is their commitment to meeting the needs of people living in poverty. Their degree of adherence to the three pro-poor principles demonstrates how far these institutions have progressed toward managing to serve the poor.

AMK began as a Concern Worldwide program in the 1990s before becoming a full-fledged microfinance institution in 2004. The institution offers group (village bank) and individual loans, savings services, money transfers, health microinsurance, payment and payroll services, foreign exchange services, and international remittances. It employs more than 2,700 people in 150 offices and works with more than 3,700 independent agents across the country. AMK has more than 840,000 clients with a loan portfolio of more than $247 million and deposits of more than $146 million, making it one of the leading microfinance institutions in Cambodia.

For over 15 years, AMK has continued to grow by focusing on developing its financial products and services and investing in new technologies to meet customer demand. At the same time, AMK has remained committed to its social objectives, particularly poverty reduction, as evidenced by the results of the Truelift assessment conducted by M-CRIL in November 2018. By providing appropriate and sustainable microfinance services over the past 15 years, AMK has helped its clients and their families, particularly those living in remote areas, achieve significant positive changes.

To develop rural economies, the EIB strengthens microfinance in Africa

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© Didier Gentilhomme

On April 1st, from 9 a.m. to 11 a.m., the Grameen Crédit Agricole Foundation and the European Investment Bank (EIB) are organizing a conference in Paris on the theme of developing rural economies and strengthening microfinance in Africa through the EIB.

Jérôme Brunel, Secretary General of Crédit Agricole SA, Director of the Grameen Crédit Agricole Foundation, and Ambroise Fayolle, Vice-President of the EIB, will deliver the opening remarks. Around the table will be Eric Campos, General Delegate of the Foundation and CSR Director of Crédit Agricole SA; Soukeyna Ndiaye Bâ, Managing Director of the INAFI International Foundation and Director of the Foundation; and Mamadou Lamine Gueye, Managing Director of Caurie, a Senegalese microfinance institution supported by the Foundation. Jean-Marie Sander, President of the Grameen Crédit Agricole Foundation, will deliver the closing remarks.

Participants will discuss three themes: Is rural development in Africa an absolute necessity? Rural microfinance in Africa: what opportunities exist? Microfinance, gender, and climate change: are their destinies linked?

To participate, contact: carolina.herrera@credit-agricole-sa.fr

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Created in 2008, under the joint leadership of Crédit Agricole SA's management and Professor Yunus, 2006 Nobel Peace Prize winner and founder of Grameen Bank, the Grameen Crédit Agricole SA Foundation is a multi-sector operator that contributes to the fight against poverty through financial inclusion and social impact entrepreneurship. As an investor, lender, technical assistance coordinator, and fund advisor, the Foundation supports microfinance institutions and social enterprises in nearly 40 countries.

Crédit Agricole launches a fund for rural microfinance

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In partnership with CA Indosuez Wealth (Asset Management) and CACEIS Bank, Luxembourg Branch, the Grameen Crédit Agricole Foundation has launched a social impact investment fund enabling Crédit Agricole Group entities and Regional Banks to invest in financing microfinance institutions in rural areas.

The Foundation is thus strengthening its support for institutions operating in emerging countries to benefit populations traditionally excluded from the banking sector, and more specifically, women, who constitute the bulk of these institutions' clients. The benefit is twofold: a positive profitability objective and an impact in terms of financing income-generating activities. Two loans to microfinance institutions in sub-Saharan Africa were granted thanks to the funds raised. A quarterly monitoring report will be sent to investors. This fund will soon benefit from the Luxflag Label (promoting the financing of sustainable and responsible investments).

This first operation of this type, launched by the Crédit Agricole Group, is a great success!

For the first time, the Regional Banks and Crédit Agricole SA entities have the opportunity to join a system dedicated exclusively to international microfinance investments and structured within the Crédit Agricole group. The first fundraising round, closed on September 28, 2018, confirmed the participation of 13 Regional Banks (Alsace-Vosges, Centre-est, Centre-France, Champagne-Bourgogne, Franche-Comté, Ille-et-Vilaine, Languedoc, Loire-Haute Loire, Martinique-Guyane, Normandie-Seine, Réunion, Savoie and Sud Rhône Alpes) – which already represents 1/3 of the Regional Banks – and Amundi for an amount of nearly €6 million.

The second fundraising round, which closed on December 31, confirmed the participation of two Regional Banks (Charente-Périgord and Provence Côte d'Azur) as well as that of Crédit Agricole Assurances for a total amount close to 8 million euros.

The Grameen Crédit Agricole Foundation – 10 years of supporting microfinance and social entrepreneurship

The Grameen Crédit Agricole Foundation was created in 2008 by Crédit Agricole and the Nobel Peace Prize-winning Professor Yunus Grameen Foundation. Operating in 33 countries, nearly half of which are the world's poorest, the Foundation is committed to combating poverty and promoting financial inclusion. In 10 years, the Foundation has provided more than €215 million in financing. Alongside the Crédit Agricole Group, the Foundation is developing new instruments to increase its financing capacity and strengthen its impact.

The Foundation is proud to work alongside Crédit Agricole SA entities and the Group's Regional Banks to strengthen its action in favor of financial inclusion and the financing of rural economies.

For more information:
pascal.webanck@credit-agricole-sa.fr
carolina.herrera@credit-agricole-sa.fr

In 2018 the Foundation invested €3.7 million in East Africa

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It has thus financed two partners in Kenya: BIMAS, with a loan of 500,000 euros, and VERT Ltd. with a loan of 440,000 euros. BIMAS is a microenterprise development program (MED-P) established in 1992 under the auspices of PLAN Embu. Its objective is to contribute to sustained economic growth and employment in the rural sector, which will result in improved social well-being and increased income for the rural population in Kenya. To date, BIMAS has more than 18,500 clients, including 66.5% women. VERT Ltd., for its part, is a company specializing in the export of fresh fruits and vegetables. The company, created in 2000, has adapted its business model over the years to better meet the specificities of the European market and adapt to current legislation. It has also implemented a more sustainable model by working directly with small local farmers organized into small groups. The Foundation has been a shareholder in VERT Ltd since 2016.

The Foundation also provided its first funding to the MicroLoan Foundation in Malawi, with a €256,000 loan. The MicroLoan Foundation is a UK-based microfinance charity that provides business training, loans, and ongoing support to women living in Malawi, Zambia, and Zimbabwe. The organization's primary goals are poverty reduction and women's empowerment. In Malawi, the institution now has nearly 30,000 clients, all women. In Uganda, the Foundation provided a new €700,000 loan to the microfinance institution UMF. UMF (Uganda Microcredit Foundation) is a microfinance institution that provides loans and other microfinance services to economically active people in Uganda. The institution specializes in commercial and personal, financial, and non-financial products for businesses and individuals to facilitate their development. The institution has more than 4,000 clients, including 54% women and 70% in rural areas.

In Zambia, the Foundation also funded two partners: AMZ with a €600,000 loan over a four-year period and FINCA Zambia with a €1.2 million loan over a three-year period. Agora Microfinance Zambia (AMZ) is a microfinance institution that specifically targets low-income individuals with appropriate financial products. AMZ aims to serve clients who were previously excluded from the formal financial market, primarily due to their poverty or place of residence. It has over 25,000 clients in 391 rural areas. 611 of these clients are women. FINCA Zambia, for its part, is a multi-service microfinance institution that currently serves over 9,000 clients with financial services, including loans, savings, payments, and money transfers. FINCA Zambia's clientele includes 571 women.

For more information about our partners, click here.

The Foundation is carrying out bond financing with OSHUN

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Today, nearly one billion people lack access to improved drinking water sources. Sub-Saharan Africa is one of the most affected regions: between 25 and 50% of its population still lack access to water from an improved drinking water source, and between 75 and 1,000 lack access to a household connection.

Founded in 2014, OSHUN deploys an innovative water service solution in rural areas. Based on an original business model that leverages local entrepreneurship, OSHUN provides high-quality water services through water kiosks at a price that matches the willingness to pay, while providing optimal health guarantees. This business, which is expected to expand to several African countries, began in rural Senegal.

For the first time, the Grameen Crédit Agricole Foundation's project committee has approved €200,000 in bond financing to cover investments and working capital for OSHUN, a new partner headquartered in France. This project is co-financed with the Caisse Régionale Alpes Provence, one of whose clients, the Société du Canal de Provence, is a stakeholder in the project. The Caisse Régionale benefited from the Foundation's expertise in the water sector and its knowledge of the local economy.

For more information on the Foundation's partners, click here.

The Foundation makes new investments in Asia

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© Didier Gentilhomme

The Grameen Crédit Agricole Foundation has made new investments with its Asian partners, granting five loans in Indonesia, Burma, Sri Lanka, and Cambodia. In Asia, the Foundation has 14 partners, representing 251,000 TND of its total outstanding loans as of the end of December 2018.

It thus granted a loan of 2.1 million euros to KOMIDA, a long-standing partner of the Foundation, which works exclusively with women in Indonesia. KOMIDA is a microfinance NGO that began offering microcredit in 2005 to the tsunami-affected population in the province of Banda Aceh. The institution transformed into a savings and credit cooperative in 2008 and now has more than 545,000 clients.

The Foundation also granted a €1.1 million loan to Proximity in Burma. Proximity Finance is a microfinance program developed by Proximity Designs that aims to eradicate extreme poverty in the country by treating the poor as clients and offering innovative and affordable technologies and services to the families it finances, who earn their living by cultivating small plots of land. The institution has nearly 100,000 clients, including 66,133 women.

In Sri Lanka, the microfinance institution Berendina, whose mission is to reduce poverty and provide better living conditions for the country's poorest groups, received a guarantee from the Foundation for an amount of 331,000 euros. To date, Berendina has 99,000 clients, including 87% women. All of its clients are located in rural areas.

Finally, in Cambodia, the Foundation granted two new grants to AMK and Chamroeun, each worth €2.5 million and €973,000. AMK (Angkor Mikroheranhvatho (Kampuchea) Co. Ltd) primarily provides loans through the "village banking" methodology, primarily targeting poor women in rural areas, as well as agricultural activities. Since 2010, the institution has also been authorized to collect savings. To date, it has nearly 325,000 clients in 93% rural areas and 81% women. Chamroeun, for its part, has 26,300 clients and is a microfinance institution that places social vocation at the heart of its business model. It provides financial services to the poorest and also offers them a range of training and support services.

To learn more about the Foundation's partners, click here.

Harmony between social and economic performance is possible

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     By Hélène Sananikone, Grameen Crédit Agricole Foundation

© Philippe Lissac

"Social" and "business" are two terms that have long been considered contradictory and continue to be so for many. However, there are economic models that structurally aim to reconcile social impact and economic development on the same level. In the early 2000s, Professor Yunus laid the foundations of a model with these characteristics: "social business," which can be translated by the generic term "social enterprise." Like any traditional business, it seeks to achieve financial profitability, but it must, at the same time, meet its objective of social utility, which is integrated into the heart of its governance and operations.

Displaying a profitability profile when considering social impact is not a simple equation because this objective entails additional costs for the company. The break-even point necessarily takes longer to reach, and mechanically, the need for equity is often greater, but the equation is far from impossible.

Indeed, when leaders are driven by a deep determination to create positive externalities through their company's value creation, they find ways to generate social impact and sustain their actions. Increasingly sought after, this model combining impact and profitability is increasingly emerging as a model for the future. At the Foundation, we are seeing more and more companies seeking to serve low-income customers (Base of Pyramid, BoP) by leveraging the volume effect but also by sharing costs across a wide range of products. In these cases, the social objective proves to be a lever for wealth creation. A success story that illustrates this point: Laiterie du Berger, a Senegalese social enterprise in which the Grameen Crédit Agricole Foundation is a shareholder.

La Laiterie du Berger, an entrepreneurial adventure

La Laiterie du Berger is a story of Senegalese family and friends who believed in the possibility of structuring a milk production sector in Senegal. The project, initially, was to offer an economic model to Fulani herders to enable them to increase their income and, therefore, their standard of living through a model for producing, collecting, and promoting Senegalese milk.

When this project was first developed, many thought it was impossible: using fresh Senegalese milk in the manufacture of dairy products is a bit like building an oasis in the desert: very expensive and uncompetitive compared to competitors who only use powdered milk imported directly from major producing nations.

Faced with these difficulties, the project leaders sought to partner with long-term industrial and financial partners and then build a milk value chain model together. Laiterie du Berger thus developed a hybrid model by combining the promotion of locally produced milk with the use of powdered milk to reduce industrial production costs. The company also developed an umbrella brand, "Dolima," covering a range of affordable dairy products aimed at populations with varying incomes but all concerned about consuming dairy products. The company recently supported its growth around the slogan "Good for me, good for my country," which has enabled the "Dolima" brand to become a national reference.

After 12 years of operation, Laiterie du Berger offers a wide range of well-segmented dairy products and has now reached economic breakeven. The plant is operating at full capacity, and new investments are being considered to keep pace with demand for Dolima products.

Thanks to the tenacity of its founder and co-shareholders, the company has always been vigilant about its social mission while facing many years of implementing its own economic model. It is thanks to the mastery of the agricultural value chain, from "farm to fork" or "from breeder to consumer," that this project was not only able to see the light of day but, above all, to reach its break-even point. This took 10 years.

A future to share between Franche-Comté and Senegal

A second chapter will now open thanks to the arrival of a new shareholder: Crédit Agricole Franche Comté. Following a "Solidarity Banker" mission in June 2018, the regional bank agreed to second an agricultural engineer for two years to join KOSAM 2, a project whose ambition is to structure a dairy sector. The territorial issues of northern Senegal are in fact close to the history experienced in Franche-Comté during the creation of the Comté Appellation d'Origine Contrôlée (AOC) and the promotion of livestock milk production. The objective is to sustain the income of livestock farmers by strengthening their production capacity and thus ensuring that Laiterie du Berger has the necessary supply to develop its specific range.

The story of Laiterie du Berger shows us that, although complex, the marriage of profitability and social impact is possible. At the Grameen Crédit Agricole Foundation, we are convinced of this and will continue, alongside our partners, to promote this vision of the future of business and sustainable finance.

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