MICROCAPITAL BRIEF: ADA, Grameen Crédit Agricole Foundation Respond to COVID-19 with Information Sharing, Funding, Partnerships

Luxembourg-based NGOs ADA (Appui au Développement Autonome) and the Grameen Crédit Agricole (GCA) Foundation have launched a range of resources in response to the COVID-19 pandemic including the following:

(1) “Response COVID-19,” through which ADA has directed EUR 1 million (USD 1.1 million) to help businesses in developing countries continue operations while protecting their clients and staff. This program has enabled: (1) “The purchase of products and equipment,” such as masks and disinfectants; (2) technical assistance regarding how to maintain operations while implementing new sanitation and safety protocols; and (3) technical assistance regarding new strategies and products, including digital offerings.

(2) A toolbox from ADA to facilitate implementing the guidelines in the “Guidance Note on Business Continuity for MFIs,” which was described in a previous MicroCapital piece. This toolbox includes a template to assist in the development of a “business continuity action plan,” a model to “build scenarios and perform liquidity gap analysis,” and a stress test protocol for analyzing how well-equipped a business is for handling financial crises. The stress test is from Microvision, an initiative helping smaller microfinance institutions (MFIs) build business plans.

(3) A French-language guidance note published by the Banque Centrale des Etats de l’Afrique de l’Ouest (BCEAO) and ADA addressing maturity deferral and systems of internal control for financial services providers (FSPs) in the eight nations of the West African Monetary Union.

(4) A monthly survey through which ADA; GCA Foundation; and Inpulse, a Belgium-based investment manager, have collected and shared data from 110 FSPs on the effects of the pandemic. This series of surveys builds on data collection efforts that GCA Foundation began in March, as were described in previous MicroCapital coverage. All of these surveys are presented and analyzed in the COVID-19 Observatory.

(5) “The COVID-19 Observatory,” an online resource from GCA Foundation providing articles on COVID-19 and GCA Foundation’s insights regarding the effects of the pandemic on the microfinance institutions it supports.

(6) “Key Principles to Protect Microfinance Institutions and Their Clients in the COVID-19 Crisis,” a pledge launched by GCA Foundation in May, as presented in a previous MicroCapital story. As of July, 30 organizations have signed the pledge.

Established in 1994, ADA’s mission is to reduce poverty by serving as a “catalyst to generate, identify, develop and implement solutions that facilitate inclusive development.” The organization does this by providing training, technical assistance, funding and “digital solutions” to MFIs. These digital solutions aim to promote financial inclusion by extending services via digital platforms such as telecom operators. As of 2019, ADA partners with approximately 550 MFIs in 40 countries and reports a budget of EUR 9 million (USD 10 million). As of December of that year, ADA managed outstanding loans of EUR 32.7 million (USD 36.9 million) deployed from the Luxembourg Microfinance Development Fund to 55 MFIs in 25 countries.

GCA Foundation was established in 2008 by Credit Agricole, a French retail bank, in partnership with Muhammad Yunus, the founder of Grameen Bank. The organization seeks to reduce poverty by providing funding and technical assistance to microfinance institutions and other social businesses. As of June 2020, GCA Foundation had commitments of EUR 92 million (USD 105 million) outstanding to 83 partners in 40 countries in Africa and Eurasia. These partners serve approximately 8.6 million customers, of whom 85 percent are women and 82 percent live in rural areas.

By Jessica McLeod, Research Associate

Sources and Additional Resources

ADA article: “How ADA is tackling the COVID-19 crisis”
https://www.ada-microfinance.org/en/covid-19-crisis/fiche-covid-19-crisis/2020/06/how-ada-is-tackling-covid

ADA homepage
https://www.ada-microfinance.org/

COVID-19 Observatory
https://www.gca-foundation.org/en/covid-19-observatory

GCA Foundation homepage
https://www.gca-foundation.org/

Inpulse homepage
https://www.inpulse.coop/

ADA Activity Report 2019
https://www.ada-microfinance.org/en/our-resources/media-center?media=255

Previous MicroCapital article on GCA Foundation
https://www.microcapital.org/microcapital-brief-zola-edf-harness-securitization-to-expand-solar-energy-in-cote-divoire-with-support-from-credit-agricole-cib-grameen-credit-agricole-foundation-societe-generale-afdb/

Previous MicroCapital article on ADA
https://www.microcapital.org/microcapital-brief-ada-belgian-raiffeisen-foundation-cerise-launch-interface-integrating-spi-4-mfi-factsheet-on-microfact-website/

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