Proparco and Ecobank Togo join forces to finance Togolese SMEs
published on 28 November 2022
On the sidelines of the Africa Financial Industry Summit, Proparco and Ecobank Togo signed two portfolio guarantees, ARIZ and EURIZ, for a total amount of EUR 4 million, or EUR 2 million each.
This signature comes within the framework of the Alliance for African Entrepreneurship (AforE) initiative which aims to support the development of the private sector and entrepreneurship in Africa and thus promote dynamic, competitive and inclusive economies on the continent.
Ecobank Togo, the first subsidiary of the pan-African banking group Ecobank Transnational Incorporated (ETI), is a major banking institution in the country with strong expertise in SME financing. Proparco and the Ecobank Group have had an important partnership for private sector development in Africa for over a decade. Since the launch of the Alliance for African Entrepreneurship, Proparco has provided EUR 37 million in portfolio guarantees to Ecobank's West African subsidiaries in Côte d'Ivoire, Ghana, Senegal and now Togo.
These portfolio guarantees will enable Ecobank Togo to increase its financing of Very Small and Medium Enterprises (VSEs) in the country, with a particular focus on women's entrepreneurship, which is a key component of the Ecobank Group's strategy, notably through its "ELLEVER" initiative.
The ARIZ portfolio guarantee, with 50% coverage, is one of AFD Group's emblematic tools, particularly effective in encouraging investment and job creation in SMEs operating in many sectors of activity (agriculture, health, industry, microfinance, transport, etc.).
The EURIZ guarantee, which is supported by the European Union and the African, Caribbean and Pacific Group of States (OACPS), will enable Ecobank Togo to support investments by SMEs with a high development impact by sharing 70% of the credit risk. It specifically targets social sectors, agriculture, climate co-benefit investments, and women-owned or women-led businesses.
These loan offers guaranteed by Proparco are part of the French Choose Africa initiative, implemented by AFD Group, which aims to commit €3.5 billion to African start-ups, VSEs and SMEs over the 2018-2022 period.
"Through this umpteenth collaboration with Ecobank, Proparco wishes to support the strengthening of the Togolese economic fabric. This new partnership will enable Ecobank Togo to strengthen its activity in favor of SMEs and promote their access to financing," said Djalal Khimdjee, Deputy Managing Director of Proparco.
For Paul-Harry Aithnard, Executive Director for the UEMOA region of Ecobank, "As MSMEs represent more than 70% of the Togolese economic fabric, facilitating their access to financing will boost their productivity, create jobs and generate more value for them and for the country's economy."
