Participants of the SAM 2017 testify


How Oikocredit Leveraged SAM to Expand Its Risk management Program

Since 2015, Dutch cooperative investor Oikocredit has offered a risk management program for MFIs. Participating institutions have built action plans around efforts such as: (1) increasing their use of data from credit bureaux to reduce over-indebtedness; (2) adjusting loan officers’ workload and training to improve client service; and (3) surveying clients about product terms. When expanding the program to a new country, Oikocredit holds a workshop that is open to the entire sector to engage potential partners. From this pool of workshop attendees, those who demonstrate the greatest motivation and ability to make progress in risk management receive a package of consulting services lasting 18 to 24 months.

SAM 2017

The program first was active in Benin, Ghana and Togo. As a result of Oikocredit’s sponsoring an event at the 2015 SAM in Dakar to increase awareness of its risk management efforts, several institutions from other countries expressed interest in the program. One of these was the Association Professionnelle des Systèmes Financiers Décentralisés du Sénégal (APSFD/Senegal), whose members include 105 savings & loan associations, cooperatives, MFIs and other financial services providers.

At the 2017 SAM in Addis Ababa, representatives of Oikocredit discussed the risk-management program with staff from ICCO Cooperation, a group of entities that seek to “create profitable opportunities that lead to more employment and higher income for people” in low- and middle-income regions. Based on their work in 36 countries, ICCO Cooperation staff argued that Burkina Faso would be a prime market for Oikocredit’s program. After Oikocredit staff met with existing and prospective partner institutions from the country, such as Asiena, Prodia and the Federation des Caisses Populaires du Burkina (FCPB), they agreed that expanding in Burkina Faso would be fruitful.

"We reviewed our priorities after SAM and promoted Burkina and Senegal to include them in the next phase of the risk management program."

Y.KOMACLO

Yves Komaclo | Oikocredit’s Regional Manager for West Africa

Yves Komaclo, director of Oikocredit in charge of West Africa, explains: "We reviewed our priorities after SAM and promoted Burkina and Senegal to include them in the next phase of the risk management program. " Oikocredit is now working with ICCO Cooperation to expand the program and serve MFIs in Burkina Faso, Mali and Senegal.

In parallel with the risk management program, Oikocredit progressed on other fields during the SAM. For example, his team spoke about the digital initiative for Oikocredit's MFIs in Burkina Faso with the Burkina Faso Private Enterprise Credit Agency (ACEP), one of five members of ACEP International. This initiative aims to facilitate access to financial services for micro-enterprises and SMEs by exploiting Oikocredit's fintech experience in supporting MFIs wishing to adopt mobile financial services.

During speed-dating sessions and informal conversations during the SAM, Oikocredit also identified partners interested in social audits and evaluations of their client protection practices. Among these partners are the Network of Micro-institutions of Income Growth, a mutual credit and savings of Mali and the Mutual Savings and Credit (MEC) Fadec Njambur of Senegal.

How Paidek is Leveraging SAM to Diversify its Funding Sources and Product Line-up

Rémy Mitima

Remy Mitima | Paidek GM & MAIN President

Remy Mitima, who serves as general manager of the Congolese microfinance institution Paidek, has attended all three SAMs. He explains, “In Arusha, I met partners who ended up loaning us a total of USD 500,000 in two phases. This helped us strengthen our credit portfolio and serve more people. Today, we have an additional loan from the same partners.”

At the second SAM in Dakar, Remy and his team strengthened their relationship with other organizations that may help with the evolution of the MFI’s technology. Musoni is one group with which they began discussions, but Paidek hasn’t moved forward in this area yet due to budget constraints.

“I met partners who ended up loaning us a total of USD 500,000…. Today, we have an additional loan from the same partners.”

SAM 2017

At the most recent SAM in Addis, Remy says his team learned “a lot about lending to youth.” As a result, the institution has resolved to adjust its methods for working with young people. Paidek has submitted an application to the UN to support these changes and now is waiting for a reply. Attendees from Paidek also met with old and new partners regarding the organization’s transformation from an NGO into a for-profit entity, which remains ongoing.

Paidek, which is located in the city of Bukavu in the Democratic Republic of the Congo, was founded in 1996 and now has nine branches. The institution has total assets of USD 5.3 million, a gross loan portfolio of USD 3.9 million outstanding to 15 million borrowers, and USD 500,000 held for 980 depositors.

Remy also serves as President of the Microfinance African Institutions Network (MAIN). MAIN, which is a co-organizer of SAM, officially merged with Africa Microfinance Transparency during the most recent SAM. Based in Togo, MAIN has 84 members with an aggregate loan portfolio of USD 1.26 billion outstanding to 3.2 million customers in 23 countries.

Using SAM to Align Financing Needs, Social Impact in Mozambique.

Francisco Cuamba & Jean Jaecklé (ADA)

When Francisco Cuamba, the Finance Director of Mozambique’s Microbanco Confianca (pictured at left), came to Luxembourg for European Microfinance Week in November, he was very pleased to"win a free registration to the 2019 SAM, which will be held in late October in Ouagadougou, Burkina Faso. Reflecting on the 2017 SAM in Ethiopia, he said, “My participation in SAM was an extremely important opportunity to meet different organizations from all over the world to share different experiences and meet some investors to which to present my organi-zation. The type of investors we sign should be social investors that are not only concerned with the profitability of the investment, but also our  extensive involvement in the development of our community and changing lives.” In particular, Mr Cuamba expressed plans to learn more about SPI4, the fourth iteration of a set of social performance indicators (SPIs) intended to simplify reporting and provide a common language for social performance management. The 2017 SAM included a full-day training on SPI4, and similar opportunities are expected at the 2019 SAM, the agenda of which is currently under development.

“My participation in SAM was an extremely important opportunity to meet social investors that are not only concerned with the profitability of the investment, but also our extensive involvement in the development of our community and changing lives.”

Microbanco Confianca was created by the NGO Hluvuku-Adsema, which was formed in 1996. The institution now has 13 branch locations, 87 employees and 9,120 clients. With a loan portfolio equivalent to USD 3.5 million, it generated return on equity of 17 percent and return on assets of 9.1 percent during 2017. The majority of the staff and clients of the organization are women. The creation of Microbanco Confianca, which remains owned by Hluvuku, will allow the institution to accept deposits.

SAM Enables Partnership Between ID Ghana, Grameen Credit Agricole Foundation.

Philippe Guichandut

Philippe Guichandut | Head of Inclusive Finance Development at the Grameen Credit Agricole Foundation

Philippe Guichandut, the Head of Inclusive Finance Development at the Grameen Credit Agricole Foundation, has been at all three SAMs. The majority of the foundation’s 76 partners are in sub-Saharan Africa, and Mr Guichandut has found that “SAM is the best place to meet our existing and potential partners.” He adds, “Around the SAM, we always take the opportunity to gather our partners, [which] is the best way to have exchanges of experience among our partners and give them the opportunity to attend some training sessions either organized by ourselves or the SAM.” Leading and attending workshops at SAM has been key for Mr Guichandut’s team “to share our own experience and promote themes that are relevant for us, especially in the fields of agri-microinsurance and agri-financing.” For example at SAM in Ethiopia in 2017, the foundation organized a field visit for 11 MFIs to learn about the R4 Rural Resilience Initiative, an agri-microinsurance project of the World Food Program and Oxfam America. Attendees visited Africa Insurance, Nyala Insurance, the microbank DECIS, and two local NGOs, ORDA and REST.

“SAM is the best place to meet our existing and potential partners.”

Mr Guichandut added that SAM’s “Investor’s Fair is also an excellent venue to meet potential new partners and have a better understanding of the different types of MFIs that would be interested in working with us.” For example, his team met representatives of ID Ghana for the first time at the fair. That relationship has flourished, and the Grameen Credit Agricole Foundation is now funding ID Ghana through the African Facility, a collaboration between the foundation and Agence Francaise de Developpment.

RCPB Improves Youth Training, Links with Solar Provider at SAM.

Le Réseau des Caisses Populaires du Burkina (RCPB), a savings and credit cooperative with 180 locations in Burkina Faso, has sent several staff members to each SAM conference. In Dakar, they made contact with a provider of solar light kits that hold a charge for four days. RCPB now lends to women to purchase these kits, which can have a wide range of benefits, such as increased student study time and reduced indoor air pollution from burning kerosene.

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Azaratou Sondo Nignan, the deputy director of RCPB, was part of a delegation that presented at SAM on the institution’s youth loans. In addition to sharing its expertise with other organizations, the delegation brought back ideas that helped improve the training that RCPB’s young borrowers receive in support of their loans.

RCPB staff also heard from a representative of a firm in Niger that offers a system to control irrigation canals remotely. Ms Sondo feels this would be beneficial to RCPB clients, but the cost is too high at this time.

Ms Sondo is very pleased that the next SAM will take place in her country for many reasons, including that several microlenders in Burkina Faso have acquired financing based on relationships that were developed at prior SAMs.

“We came back with ideas that helped improve the training that RCPB’s young borrowers receive…” - Azaratou Sondo Nignan, Le Réseau des Caisses Populaires du Burkina.

Founded in 1972, RCPB offers savings; group and individual loans; and insurance in case of natural disaster, disability or death. It has loans designed for artisans, agriculture and housing. The cooperative also offers non-financial services such as business consulting and financial education.

Other testimonials

Ambroise Fayolle, Vice-President of the European Investment Bank
Ambroise Fayolle “The EIB was extremely pleased with the organisation of the SAM. My colleagues and I appreciated the depth of the discussions and the event was a unique opportunity to meet with potential new clients, established partners, peers and other investors, whether this be around the stands or at the Investor Fair. Even if we were delighted to be able to emphasise our Bank’s commitment to investing in projects which will have a considerable impact in terms of microfinance and equity in Africa, we also learned a great deal. We are already looking forward to the next SAM!”
 

Stephen M.K. Dugbazah, General Manager at Initiative Development-Ghana (ID Ghana)
“As a Financial NGO supporting the less privileged with affordable small loans and training, access to less expensive loan fund for on-lending has always been a challenge until we started participating in the Investors fair at the SAM. Thanks to the SAM ID Ghana FNGO now has access to Social funds and Technical supports, from Fefisol, Alterfin, ADA, Grameen Credit Agricole and SPTF”.
 


Ruchit Garg, Founder & CEO at Harvesting Inc, winner of the Fintech Prize for Microfinance 2017 worth 10,000 euros
Prize FMO"The €10,000 prize was extremely valuable for us as we seek to scale our work to more farmers in under-served markets. We spent the prize money bringing in a new remote sensing scientist and carrying out field research with potential partners in Nigeria and Kenya. The publicity from SAM and FMO was also significant in increasing our market visibility and opening up new partnership opportunities."


Jeroen Harteveld, MASSIF Fund Manager at FMO
"The mission of FMO is to empower entrepreneurs to build a better world. We want to stimulate local economic growth, create jobs that generate income thereby improve livelihoods of people and drive local prosperity in places where it is needed most. Capital, knowledge and networks are essential to address financial inclusion. The SAM brings all this together: impact investors, financial inclusion experts and investment opportunities making this a great event."
 


Sambou Coly, Program Manager at Mastercard Foundation
"SAM 2017 provided us with a framework for thinking about the reasons that still limit access to basic financial services for millions of people in Africa. These moments of reflection are an important barometer to validate but also to reconsider certain choices in order to enable us to achieve a goal that we all have in common."
 


Eric Campos

Eric Campos, Managing Director at Grameen Crédit Agricole Foundation

"The African Development Bank recently presented the 2018 edition of the African Economic Outlook. According to it, China, and its approach to national development, can be a source of inspiration for Africa. Recall that in 1979, China's GDP per capita was one-third of the average for sub-Saharan Africa. Since its "economic revolution" almost 40 years ago, annual growth has averaged nearly 10%.

According to the AfDB, China has managed to move away from the prevailing economic thinking, advocated by international bodies, to adopt a pragmatic approach: support large capital-intensive companies and open the industrial economy to private companies interested in exploiting the comparative advantage of China.

The AfDB draws three lessons on the economic development of a continent: it must feed on pragmatism adapted to realities on the ground, it must benefit from an industrial strategic framework allowing technological innovation and industrial modernization and finally, the "invisible hand" and the state must take their share of respective responsibilities in the economic transition, by interest or obligation.

Without judging the quality of the implementation of such an approach and its impact on the environment and society, of which there would be a great deal to say, there is in these three points a very relevant reading grid that is a perfect fit for the microfinance sector in Africa.

Microfinance has become as indispensable to the development and functioning of northern and southern economies and societies as traditional finance. In ten years, the penetration rate of microfinance has multiplied by 2.5 and outstandings multiplied by 4. These financing mechanisms for low-income people are taking a vital place for small rural economies. The SAM, gathered this year in Addis Ababa, Microfinance Institutions from all over the African continent, regulators (central banks ..) and private investors (donors, social investors, foundations, funds ...).

The approach proposed in the context of this African Microfinance Week is remarkable because it basically adopts the same approach as that promoted by the AfDB: this event feeds on pragmatism adapted to the realities of the field, it promotes exchanges with regulators to fully understand the need for a strategic framework that promotes technological innovation (digital services, agricultural microinsurance, etc.) and allows private and public operators to meet to determine their respective share of responsibilities in economic development of territories.

If I had a wish, it is to see the next SAM welcome the establishment of a true interregional strategic plan for African microfinance to effectively fight against the weakening of rural economies, which seems to me today. one of the priorities of the continent.

The SAM seems to be in any case the right forum to promote this kind of continental initiative."
 


Josée Mukandinda, Head of Operations at Umutanguha Finance Company Ltd (on the left in the picture)
"The sessions were well prepared and focused on interesting topics. Different categories of organization were invited: banks, MFIs, small and large companies. Moreover, the specific themes focused on young people and women, relatively vulnerable targets, were highlighted, particularly during the "Financial inclusion and job creation in Africa" session.

Josée MukandidndaThe SAM in Addis Ababa has facilitated exchanges between different microfinance stakeholders and investors on the concerns of African financial inclusion. The job creation achievements served as a model for the UFC.

From the invitation to the SAM until its closing, I was impressed by the impeccable teamwork that was done by the ADA staff, who was keen to make the SAM a great success. The team must keep the same enthusiasm in preparing for such events!"


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