N'Djamena, 9 June 2023-The African Development Bank, through the Africa Digital Financial Inclusion Facility (ADFI),has signed a grant agreement for $650,000 with the Government of Chad to promote economic empowerment of women and youth through innovative digital financial and non-financial services.
This initiative contributes to the Microfinance Development Support Project for Women and Youth Entrepreneurship to facilitate the access of vulnerable groups to innovative and secured financial and non-financial services through digital transformation, and to promote women's economic empowerment and youth entrepreneurship in the country's rural areas.
Launched in December 2021, this initiative is led by the Agriculture, Human, and Social Development Complex (AHHD) and financed by the Africa Digital Financial Inclusion Facility (ADFI) together with co-funding of UA 9.5 million from the African Development Bank’s Transition Facility Fund and of UA 500,000 from the Bank’s Affirmative Finance Action for Women in Africa (AFAWA).
The overall aim is to provide systemic support to the microfinance sector and the entrepreneurial ecosystem by facilitating access of vulnerable groups to innovative and secured financial and non-financial services through digital transformation, and to promote women's economic empowerment and youth entrepreneurship in the country's rural areas. The project will be implemented over five years and has three components: to improve the supply of microfinance services and develop digital finance, improve the demand for financial services and strengthen the entrepreneurial ecosystem in rural areas, as well as project coordination and management.
The funding support from the Africa Digital Financial Inclusion facility (ADFI), together with technical assistance from ADFI and oversight from AHHD and AFAWA,aims to support increased financial inclusion and job creation opportunities by not only building the capacity of microfinance institutions to develop new digital financial services for excluded women and youth, but also through the first FinScope study to assess the supply and demand of financial services in Chad.
Mr. Ali Lamine Zeine, Country Manager of the African Development Bank’s Chad office, underscored the importance of the Bank’s support to the project, saying it would contribute to strengthening the microfinance sector and the entrepreneurial ecosystem in Chad, particularly for women’s groups and young entrepreneurs.
At the African Development Bank, we recognize that we have a major role to play in supporting innovative technology that can increase access and use of digital financial solutions and spur entrepreneurship, particularly among excluded and underserved groups. This initiative contributes to the delivery of our High 5 strategic priorities by seeking to build a robust and sustainable microfinance sector in Chad, with the potential to leapfrog barriers to inclusive digital financial solutions, accelerating economic resilience, reducing poverty and stimulating growth.”
>With banking services almost non-existent outside urban areas, only 7% of Chadians have access to financial services and resort to the informal system or loan sharks. Despite the implementation of the Government of Chad’s National Financial Inclusion Strategy (201-2024), most of the 115 registered microfinance institutions (MFIs) continue to face enormous difficulties in meeting the needs or marginalised groups, particularly small businesses, as their activities are limited by lack of infrastructure, capacity and reliable technological solutions.
The African Development Bank, together with its partners, launched the Africa Digital Financial Inclusion Facility to make catalytic investments in support of innovative ideas and to use blended financing to promote impactful scale. By working in partnership with the Bank’s regional member countries and offices to mainstream digital financial solutions across their operations, ADFI seeks to support initiatives with the potential to make a significant contribution to building resilience, mitigating risk and strengthening economic empowerment.
“Ensuring that vulnerable groups have adequate access to financial and non-financial services is instrumental in bridging the gender gap and creating economic opportunity for financially excluded groups, especially for women and youth who bear the brunt of such disparities.” Sheila Okiro, ADFI Fund Coordinator.
ADFI is a pan-African initiative designed to catalyze digital financial inclusion throughout Africa with the goal of ensuring that 332 million more Africans, 60% of them women, gain access to the formal economy. Current ADFI partners are the French Development Agency (AFD); the French Treasury’s Ministry for the Economy and Finance; The Government of Luxembourg’s Ministry of Finance; the Bill and Melinda Gates Foundation; and the African Development Bank, which also hosts the fund. For more information: www.adfi.org
African Development Bank: Olufemi Terry | Communication and External Relations Department | email: [email protected]
Africa Digital Financial Inclusion Facility (ADFI)
Louise Simpson |Communications, Knowledge Management & Advocacy Consultant
Email: [email protected]