This financing should soon be combined with the signing of an ARIZ portfolio guarantee.
“Société Générale is Proparco’s main partner in Burkina Faso. Following an initial EUR 15m loan allocated in 2016, this new financing demonstrates PROPARCO’s confidence in this key partner and confirms SG BF’s commitment to small and medium-sized enterprises”, says Tanguy Denieul, Director of AFD’s agency in Burkina Faso, who represented AFD Group during this signing. “In addition to this financing, Proparco is also supporting the deployment of Société Générale Group’s new Environmental and Social mechanism in its African subsidiaries and therefore in SG BF.”
This new operation to support African microenterprises and SMEs is part of the French Choose Africa initiative implemented by AFD Group. With Choose Africa, Proparco and AFD are making all its tools available to African start-ups, microenterprises and SMEs to finance them and assist them at the various stages of their development, and in particular via local partners supported by the Group. EUR 2.5bn will be earmarked to support African entrepreneurs by 2022. A total of around 10,000 small and medium-sized enterprises will benefit from this initiative.
An ARIZ portfolio guarantee should also be signed soon between the two partners. This guarantee will allow SG BF to increase its financing for microenterprises and SMEs in the country.
For over ten years, ARIZ has been allowing financial institutions to share risks and thereby encourages local banks to develop their activities for loans allocated to small businesses, which are often perceived as high-risk clients. Thanks to the ARIZ agreement, SG BF will be able to benefit from a guarantee on the loans it will allocate to microenterprises and SMEs. The portfolio guarantee will thereby allow the bank to develop its range of loans for small businesses which contribute to the sustainable economic development of the country.
Since the launch of ARIZ, 17 guarantees have been signed by Société Générale Burkina Faso, including 3 single-deal guarantees allocated in 2018.