Luxembourg strengthens inclusive finance in Africa with SAM event in Lomé
Financial services such as savings accounts, payment solutions or loans are key pillars of sustainable development as they enable vulnerable households and micro businesses to make purchases to meet their daily needs, manage their cash, save and invest for the future and, above all, withstand financial shocks. Despite their potential to increase resilience and reduce socio-economic inequalities, these tailored services remain unavailable to large sections of the population, particularly in Africa.
The Luxembourgish government is therefore funding the African Microfinance Week (referred to as 'SAM', the French acronym), which is organised by ADA in a different African country every two years to strengthen the inclusive finance sector in Africa. This year’s edition took place in Lomé, the capital of Togo, from 16 to 20 October. With around 1100 participants, it is the biggest inclusive finance event in Africa.
“Luxembourg’s impact investment sector is unique in terms of diversity of participants, which range from impact investment funds and private FinTech companies to governmental agencies and NGOs. Through the African Microfinance Week, we are drawing on this expertise to strengthen the inclusive finance sector in Africa to support vulnerable people in saving for a better future and in starting a business. Ultimately, our goal is to contribute to improving their wellbeing and accelerate progress towards meeting the United Nation’s Sustainable Development Goals.” – Franz Fayot, Minister for Development Cooperation and Humanitarian Affairs
Climate change exacerbates existing development challenges
While the inclusive finance sector mainly aims to reduce socio-economic vulnerability and inequality, it is no longer possible to support people in developing countries without taking into account the climate-change related risks they face.
While Africa only emits between 2% and 3% of global greenhouse gases, it is the continent most threatened by climate change. Droughts, irregular rainfall and rising temperatures threaten access to water and food and pose challenges to agricultural productivity, leading to increased deprivation and migration.
Inclusive finance can help affected communities adapt to climate change by facilitating investments in sustainable and climate-smart farming practices, energy-efficient equipment and housing and by providing appropriate financial and insurance services.
“Reducing the carbon footprint of a very large number of micro and small companies through renewable energy or energy-efficient equipment can have a significant environmental impact. We are therefore striving to not just make finance inclusive but also sustainable to improve the quality of life of vulnerable people in a lasting manner, also for the benefit of future generations.” – Laura Foschi, Executive Director of ADA
Organised by ADA in collaboration with MAIN (Microfinance African Institutions Network), the week-long SAM event includes a two-day conference, an Investor Fair for impact investors looking to invest into microfinance institutions and an Innovators’ Village for showcasing the latest inclusive finance products and services.