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Strengthening financial systems and facilitating access to finance for MSMEs
A resilient, efficient and well-regulated financial system is essential to the economic stability and resilience of developing and emerging countries. Proparco works in this sector to strengthen local financial institutions, facilitate financing for small and medium-sized businesses, and promote access to suitably-adapted financial services for low-income populations frequently without a bank account.
As drivers of local economic growth, both large and small businesses must be able to rely on financial systems to underpin their development and have a positive knock-on effect on job creation and wealth generation. Difficulties in accessing credit are a real obstacle to private sector development and particularly affect small and medium-sized businesses (SMEs). In response to these challenges, Proparco works to strengthen the capacities of financial players while helping to promote high environmental, social and governance (ESG) standards.
Promoting access to finance for MSMEs
Financing micro, small and medium-sized enterprises (MSMEs) is a major driver of economic and social development. Proparco works alongside local financial institutions to boost their financing capacity and solidity and support them in high-impact sectors such as agriculture, energy and healthcare.
Through its support, Proparco aims to stimulate private initiative, encourage local entrepreneurship and facilitate access for entrepreneurs – especially women and young people – to the loans and financial services they need to grow their businesses.
Project focus – In Senegal, how microfinance is strengthening small players in the agri-food sector
In 2024, Proparco granted a €10 million loan to ACEP Senegal, a microfinance institution operating throughout the country. This support aims to boost financing provided to micro-farmers and small businesses in the agri-food sector, particularly those run by women, and strengthen their contribution to food security and the local economy.
Supporting the emergence of sustainable financial systems
Aside from its role as financier, Proparco positions itself as a technical partner to financial institutions, helping them manage environmental, social and governance risks (ESG) and deploy responsible practices. This approach aims to embed sustainable finance principles within financial systems and maximise positive social and environmental impacts.
Through technical support processes and rigorous monitoring, Proparco helps its partners adopt international standards in governance, environmental management and social responsibility.
Project focus – Supporting women entrepreneurs in Uzbekistan
In 2024, Davr Bank, a private Uzbek bank, received $20 million worth of financing from Proparco. With a strong gender dimension, this arrangement stipulates that 30% of the funds must be earmarked for improving access to financial services for female entrepreneurs. The bank also receives support with integrating ESG criteria into all of its activities.
Promoting responsible microfinance
Microfinance is a key driver for the financial inclusion of people generally excluded from traditional banking channels, particularly in rural areas or fragile contexts. Proparco supports players in the sector through customised financing, but also through structural support in the areas of governance, financial security, ESG risk management and customer protection, particularly against over-indebtedness.
Project focus – Strengthening small businesses in Haiti in a crisis context
In Haiti, ACME, a microfinance institution that has been partnering with Proparco for over ten years, obtained a portfolio guarantee equivalent to €2.65 million in 2023. This is designed to support very small businesses in a multidimensional crisis context by preserving access to financial services for the most vulnerable sections of the population.
Focus
Financing MSMEs in crisis situations: ACME’s experience in Haiti
It is essential to continue supporting micro, small and medium enterprises (MSMEs) in conflict zones, as they create both jobs and wealth however, credit financing means that financial institutions h...
Published on november 7 2024
ACEP Sénégal: how microfinance is boosting small players in the agri-business sector
Published on february 17 2025
2024 Key Data
- 43% of financial commitments dedicated to access to credit for microbusinesses and SMEs and to strengthening financial systems
- €1.186 billion dedicated to access to credit for microbusinesses and SMEs and to strengthening financial systems
Further reading
Private Sector & Development #29 - Financing start-ups to build tomorrow's african economies
Published on may 1 2018
Private Sector & Development #32 - SME finance in Africa: what's new?
Published on september 23 2019
