According to a June 2022 press release, the European Solidarity Financing Fund for Africa (FEFISOL II), aimed at supporting rural microfinance and agribusiness entities in Africa, has been successfully launched. The fund boasts a first closing of 22.5 million Euros and a technical support envelope of 1 million Euros.
Financing vulnerable populations in rural areas in Africa
“The FEFISOL II Fund is designed to respond to the crucial issues of financing vulnerable populations in rural areas in Africa, and more particularly the financing of the agricultural sector. Today, the penetration rate of microfinance in rural areas in Africa remains very low. Less than 5% of the loans disbursed by traditional financial institutions are intended for the agricultural sector and less than 10% of farmers have access to formal sources of credit,” said the Belgian Investment Company for Developing Countries (BIO).
7 European banks take a stake in the fund
According to the same press release, the fund was structured and promoted by the social investors SIDI “Solidarité Internationale pour le Développement et l’Investissement” and Alterfin and at least 7 European banks or development finance institutions have taken a stake in the fund, including the BIO.
The fund will be managed by Inpulse (an investment manager based in Brussels, subsidiary of Crédit Coopératif and SIDI) and will benefit most African countries.
“FEFISOL II will be implemented in more than 28 African countries and should eventually support 110 microfinance institutions or agricultural companies and cooperatives sourcing from smallholders, most of which are Fair Trade or organic certified,” said the BIO.
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