The Crédit Agricole Group is supporting the Grameen Crédit Agricole Foundation's development strategy with new funding of €14 million from CACIB (Crédit Agricole Corporate & Investment Bank). This funding allows the Foundation to continue its commitment to serving underbanked populations.

The Crédit Agricole Group, a key partner of the Foundation

The Foundation was created in 2008 under the joint leadership of Crédit Agricole SA and Professor Yunus, 2006 Nobel Peace Prize winner and founder of Grameen Bank. Since its inception, the Crédit Agricole Group has supported the Foundation's activities in the microfinance and social entrepreneurship sectors.

It is within the framework of this historic partnership that a €14 million loan was granted by CACIB to the Foundation. This financing, in dollars and euros, allows the Foundation to continue and expand its commitment to the financial inclusion of disadvantaged populations by creating or strengthening small income-generating activities in the countries where it operates.

Renewed growth objectives for the Foundation

The loan granted by CACIB contributes to the financing of the Foundation's development plan, which has set the objective of achieving a portfolio of commitments of around 100 million euros by 2021. At the end of August 2018, the Foundation's outstanding amount in favor of microfinance institutions stood at 58 million euros and the total financing granted by the Foundation since its inception now exceeds 200 million euros, more than four times its initial capital.

The Foundation has signed strong partnerships with BPI subsidiaries, which now allows it to operate in countries where the Group is present, particularly in retail banking.

Economic development requires supporting women's entrepreneurial activities. Their income independence is a key factor in reducing gender inequality worldwide.

With 77,000 women served among the active clients of its partner institutions, compared to the sector average of less than 50,000, the Grameen Crédit Agricole Foundation stands out as a committed player. This has been a choice it has made since its inception. It continues to do so today: approximately one-third of the institutions in its portfolio specifically target women.

Zhanna B. Zhakupova, Managing Director of Asian Credit Fund, a microfinance organization supported by the Foundation in Kazakhstan, said: “We know that women reinvest more than 90% of their income into their families and children’s education. Therefore, the more women engage in economic activities, even small ones, the more families in Kazakhstan will be able to achieve a decent standard of living. This reality is at the heart of ACF. Since 1997, we have supported more than 100,000 women by providing them with access to credit and training to start and grow their own businesses.”

Find out more here: Annual Report 2017

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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.

By Flora Helard & Mathilde Thonon, In venture

For 10 years, the Grameen Credit Agricole Foundation has been encouraging the development of local microfinance initiatives and social enterprises in the more than 30 developing countries where it operates. We interviewed Philippe Guichandut, who spoke to us about the Foundation's commitments and the results of its work.

Socially responsible, the Grameen Crédit Agricole Foundation was created in 2008 under the joint leadership of Crédit Agricole executives and Professor Muhammad Yunus, 2006 Nobel Peace Prize winner and founder of the Grameen microcredit bank (see his interview here). The Foundation encourages the development of local microfinance initiatives and social enterprises in the 32 developing countries where it operates. In 2017, €49 million was granted to partner microfinance institutions and social enterprises.

We interviewed Philippe Guichandut, Director of Development and Technical Assistance, who told us about the Foundation's commitments and results.

1. The partnership between Crédit Agricole and Grameen will celebrate its 10th anniversary. Based on the Foundation's experience, can Professor Yunus's assertion that the poor are solvent be confirmed?

Indeed, we realized that the beneficiaries of microfinance institutions generally repay their loans well, at better repayment rates than those of traditional banks for this type of client. However, the definition of "poor" must be qualified. To reach the poorest populations, microfinance is not enough. It is necessary to provide complementary non-financial services and personalized support, so that clients do not find themselves in situations of over-indebtedness. MFIs that target the poorest populations thus first offer information sessions as well as individual assistance, then credit intervenes at a later stage when the person is more ready and better equipped to develop their economic activity. So I would say that yes, under certain conditions, the poor are solvent. However, I do not believe that everyone is a potential entrepreneur; many microfinance borrowers are in a survival logic, especially among the poorest. We must carefully select individuals who will know how to use credit wisely, so as not to worsen their situation.

2. Why do you think banks have a leading role to play in solving social and environmental problems?

Banks certainly have a role to play, just like NGOs, the state, and businesses. It is important that they integrate a social dimension into their activities and evolve towards a more inclusive and responsible way of operating, so as not to leave part of the population behind. However, the social problem cannot be entirely the responsibility of banks; we need a real paradigm shift in public opinion. If microfinance emerged, it was to address a market failure that did not meet the needs of the entire population, particularly in rural areas and among populations excluded from traditional banking systems. Unfortunately, I believe that microfinance still has a bright future ahead of it.

3. Like Grameen, you specifically target women for your microfinance activities. Do you see any differences in credit use by gender?

Of course, we know that women are more likely to reinvest the profits from their activities in the family, particularly the education of children, food, housing, health, etc. This does not mean that men do not do it, but we generally see that family awareness is more present among women, which makes it possible to reach a greater number of people with microfinance and participate in improving the living conditions of the targeted people.

4. Is it possible to concretely measure the impact of microfinance on community well-being? What indicators do you use, and do you think impact measurement should be universalized?

Measuring impact is a very complex issue, and for this reason, microfinance has been heavily criticized. We face a methodology problem; there are different schools of thought regarding impact measurement. However, depending on the methodology adopted, we can find very different results. We have therefore chosen to measure the social performance of our projects, working with the SPI4-ALINUS rating tool, developed by CERISE for due diligence and monitoring of social investors. I think it would be too complex and risky to universalize impact measurement because we must take into account local specificities (religion, culture, isolation, level of development, etc.), and these vary enormously from one region to another.

5. Do you think that the MFI models you support can be exported to France, or is microfinance reserved for developing countries?

Absolutely, microfinance is growing in France and Europe. It's not just for developing countries. These are different markets and different costs, but many people who want to develop an economic activity and can't get a loan from a traditional bank are now turning to this solution. The European Microfinance Network (EMN) brings together institutions operating in Europe and seeks to improve the legislative frameworks of Europe and its member states.

6. With this partnership between Crédit Agricole and Grameen, you seem to be reaffirming your commitment to the inclusion of rural areas. What is your agenda for furthering the social inclusion of rural and isolated areas?

There is a huge amount that needs to be done to strengthen the inclusion of rural people, particularly farmers. There are very few microfinance institutions that specialize in this sector because it is very risky and highly dependent on climatic hazards. Microfinance is generally urban or peri-urban, and when it is rural, it is rarely agricultural. Understanding and financing agricultural value chains is a real challenge for us. Crédit Agricole's experience in this area in France is very useful for us. 771,300 of our beneficiaries are from rural areas, and between 20 and 301,300 work in agriculture.

7. The Foundation also invests in social enterprises. What are your selection criteria for the ones you fund? Do you invest in early-stage social businesses or those at a more advanced stage?

We don't invest in startups, but rather in already developed social enterprises, not necessarily economically sustainable but with real growth potential. For us, the most important thing is that the company's main mission is truly social. We have entrepreneurs and shareholders sign a social charter to ensure that social impact is indeed the driving force behind their company's development. Secondly, we study their business plan, the required capital, market relevance, and social indicators. We also place particular importance on the entrepreneurs' personalities because they are the ones who will make the company work or not, and trust is the basis of any partnership.

8. In your advocacy activities, do you feel that there is still a lot of work to be done to reconcile the world of finance with that of social assistance and environmental protection in the eyes of the public?

I had a long career in the non-profit world before joining the Grameen Crédit Agricole Foundation. There is a real cultural difference, but the traditional opposition between these sectors stems mainly from a lack of mutual understanding and a lot of prejudice. The private and social sectors have never been so close, more and more joint initiatives are developing, and the private sector has acquired a real awareness of social and environmental issues. It's also a generational issue; young people today have a different sensibility, and we are only at the beginning of this rapprochement.

9. As Crédit Agricole savers, what can we do at the individual level to participate in the inclusive finance movement?

There are many opportunities to participate in this movement on an individual basis, but most people are unaware of them. A lot of awareness-raising work is needed to make this information accessible. You can subscribe to Finansol-certified products, invest in social enterprises, and purchase goods or services provided by social and solidarity economy (SSE) companies. If you work for a large company, you can choose to use employee savings plans. Also, contact your bank to find out about your options.

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Source

//www.in-venture.org/fondation-grameen-credit-agricole-1

The second meeting of the Circle of Friends of the Foundation, the first of 2018, took place on June 26, and brought together employees of the Crédit Agricole group and the Foundation.

This event provided an opportunity to discuss the Foundation's work and its projects with the Group. The meeting featured three presentations focusing on the Foundation's activities in 2017, the "Solidarity Banker by CA" program, and cooperation plans with the Group's international entities.

Eric Campos, General Delegate of the Foundation, opened the event with a brief presentation of the Foundation and the 2017 Integrated Report. With 49.3 million in financing granted in 2017 and 69 microfinance and social business institutions supported in more than thirty countries, the Foundation posted a good record and reaffirmed its position as a committed player for a more shared economy.

The meeting then turned to the synergies between the Foundation and the Crédit Agricole Group. Carolina Herrera, Director of Communications & Investor and Partner Relations, presented the "Banquier Solidaire by CA" skills volunteer program, recently established between the Foundation and Crédit Agricole SA. This unique initiative in the history of the Group and the Foundation aims to strengthen the Foundation's support for microfinance institutions and social enterprises and to promote the skills of Crédit Agricole Group employees.

This is the case of Jonathan Michaud, an agricultural engineer from Crédit Agricole Franche-Comté, who came to share the experience of his mission at the Laiterie du Berger in Senegal, a social enterprise in which the Foundation and the Regional Fund are shareholders.

During this meeting of the Circle of Friends, Hélène Sananikone, Equity Investment Manager of the Foundation, and Jonathan Michaud presented the Laiterie du Berger, which promotes the development of the dairy sector in northern Senegal using a cooperative production method.

Beyond Crédit Agricole Franche-Comté's social commitment, it was the similarities between the Laiterie du Berger's business model and the Franche-Comté region's development paradigm that motivated the Regional Bank's support for this project. The outcome of this mission resulted in the development of a detailed action plan approved by the Laiterie's Board of Directors. The objective of this plan is to improve the productivity of this social enterprise and ensure the sustainability of its business model.

The final part of this meeting of the Circle of Friends of the Foundation focused on international cooperation between the Foundation and the Group. Caroline Brandt and Violette Cubier, Investment Officers at the Foundation, presented the cooperation schemes implemented in Egypt and currently being negotiated in India, Serbia, and Morocco. These partnerships will promote the financing of local microfinance institutions, allowing the Foundation to expand its activities and the Group's entities to position themselves as financiers of the social and solidarity economy.

The meeting concluded with an invitation to the next Circle of Friends meeting on October 2 at the Crédit Agricole Montrouge Campus. More news will follow on the Foundation's and the Group's commitments to inclusive finance and the development of rural economies around the world.