Microfinance can and must take a better place in the African financial sector

Advans Ivory Coast recently announced its decision to inject 1,000 billion Fcfa, or nearly 1.5 billion euros in the Ivorian economy by 2023. In this interview with «La Tribune Afrique», its Managing Director Mr. Gael Briot gives details on the mechanisms of distribution of the supply of credit, their priority in the financing strategy of Ivorian SMEs and the major challenges in this growing sector in Africa. In order to seize the opportunities of the African market, the group also present in Tunisia, Cameroon, Ghana, Nigeria and DR Congo has developed a wide range of products, services and plans to double the number of its 350,000 customers and 2 700 African employees, in the coming years.

The Tribune Africa: Advans Côte d’Ivoire has announced its intention to inject 1000 billion CFA francs into the Ivorian economy, by 2023. What are its sources of funding?


Gaël Briot: Our shareholders are the Advans group, development banks (AFD, FMO, SFI) and a local banking partner (SGBCI subsidiary of Societe Generale Group). But especially Advans Ivory Coast is a Microfinance Institution approved by the Ivorian Ministry of Finance and the BCEAO. As a result of this approval, we have the mission of being a financial intermediary and thus collecting public savings from our target clientele. The main sources of financing as for any financial institution are the deposits of our customers. But we also rely on local banks from whom we are refinancing and also international funds specializing in the refinancing of microfinance institutions.


By what mechanisms will the sum be injected into the Ivorian economy?


Advans Ivory Coast offers a complete and adapted range of credits for micro, small and medium enterprises. We will continue and accelerate the distribution of this credit offer whose amounts vary between 100,000 FCFA (nearly 150 euros) and 300 million FCFA (about 457,000 euros) allowing all Ivorian entrepreneurs to develop their activities. These credits are distributed through our network of agencies in Abidjan and in the main cities of Côte d’Ivoire (15 agencies currently, increased to 20 by the end of 2018). Distribution is also done through our field teams (more than 200 customer service representatives) who offer local service and support to our customers.


What are the priority areas in your funding program?


Advans Ivory Coast has defined three priority targets: First, small urban entrepreneurs; we finance their working capital requirements and small investments in commercial and service activities; Then SMEs: Advans is today positioned in this segment very actively. Besides, as every year, we will organize our SME day which will take place on April 5, 2018 in Abidjan, which will bring together our SME customers to better understand their needs and to evolve our offer accordingly.


Finally, the agricultural sector: We provide financing for the cocoa and cashew nut sectors in order to improve access to inputs, develop vehicle purchases or increase working capital. We intend to expand our range of products to other agricultural sectors in the coming years.


What are the main criteria to be met to be eligible?


The eligibility criteria are simple and flexible. You must have an existing activity (even recent) and have an identified need to justify the credit. Our teams then evaluate the repayment and debt capacity to define the appropriate product and amount. It is also necessary according to the products and amounts to provide certain guarantees.


What are the challenges of the microfinance sectors in Côte d’Ivoire?

The microfinance sector faces a number of challenges. First of all, the image that has improved considerably in recent years is yet to grow with the general public: Advans is working hard to build a professional, customer-focused, rigorous and transparent microfinance. This is essential for people to trust the sector and see it as a real alternative to traditional banks. Another challenge to meet our financial inclusion mission is the financial education of clients. Today only 15% of Ivorians have an account, so we must not only offer accessible and adapted products and services but it is essential to learn the culture of savings, the importance and the risk of taking credit, … Finally, the sector’s challenge is also to ensure reasonable and sustainable growth by developing healthy credit portfolios and actively fighting the risk of over-indebtedness. A credit information bureau was launched in 2017; This allows better customer information and therefore more prudence in the credit decisions of institutions.


How do you evaluate the opportunities in the field of microfinance in Côte d’Ivoire and in Africa in a more global way?

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