AFD, GAMC sign 1.5m euro agreement

Agence Française de Développement (AFD) and the Ghana Association of Microfinance Companies (GAMC), have signed a facility grant agreement amounting to 1.5 million Euros.

The Microfinance Companies Capacity Improvement Project (MICCIP) will help GAMC to strengthen its own abilities and that of its training centre as well as to provide technical assistance to its members who have demonstrated a certain amount of professionalism and strong signs of sustainability.

A joint statement issued by the two institutions in Accra said “This will eventually improve the quality of the microfinance companies” (MFCs) financial services to the benefit of disadvantaged populations as well as to Micro Small and Medium-sized Enterprises (MSMEs) from the formal and informal sectors.

“The role of MSMEs to the economic development and growth of the country has long been established; they however usually have difficulties to access funding in fair conditions,” it said.

The statement said supporting these MFCs would create more avenues for MSMEs which would enjoy more efficient and responsible financial services, possibly leading to an access to credit at a lower cost with faster loan approval times.

The project plans to assess the best performing of GAMC’s members and will select some of them who will benefit from an 18-month technical assistance programme, building their financial skills and promoting microfinance best practices.

These MFCs will thus be able to provide good quality financial services to small and micro entrepreneurs that directly contribute to the local economy and the creation of income generating activities.

The project is also expected to increase transparency and confidence within the micro-finance sector leading to a more socially responsible and sustainable financial environment.

Ghana is one of the main beneficiaries of AFD Group’s commitments in West Africa since 2004. On a cumulative basis, total commitments of the Group from 2004 to till date amount to 902.5M Euro, of which 805M Euro are loans, 85.5M Euro are grants (including budget support) and 12M Euro are guarantees.

The signing ceremony was witnessed by the Mr. Frédéric Clavier, Ambassador of France to Ghana.