MICROCAPITAL BRIEF: FINCA Zambia Borrows $1.5m from Grameen Credit Agricole Foundation for Microfinance Lending

The Zambian subsidiary of US-based FINCA Impact Finance has borrowed local currency approximately equivalent to USD 1.5 million from the Luxembourg-based Grameen Credit Agricole (GCA) Foundation for on-lending in Zambia. FINCA Zambia aims to “be an unconventional community-based bank that profitably and responsibly provides innovative and impactful financial services to enable low-income individuals and communities to invest in their futures.” These services include loans and savings via mobile banking and agent banking. Groups of three to 10 people may borrow in amounts from ZMW 1,500 (USD 125) to ZMW 20,000 (USD 1670), and business-owners may borrow individually in amounts from ZMW 5000 (USD 420) to ZMW 159,000 (USD 13,300). Repayment schedules range from 6 to 24 months.

As of September 2018, FINCA Zambia reported total assets of ZMW 252 million (USD 21 million), gross loans of ZMW 190 million (USD 16 million) and total deposits of ZMW 71 million (USD 6 million). FINCA Impact Finance is a for-profit entity controlled by the US-based Foundation for International Community Assistance (FINCA International). FINCA International was founded in 1984 and reports 2017 revenue of USD 340 million. As of 2019, FINCA Impact Finance operates in 20 countries with a focus on poor women in the Americas, sub-Saharan Africa and Eurasia. As of 2019, it has approximately 2.2 million clients, a loan portfolio of USD 806 million and USD 403 million in deposits.

GCA Foundation was founded in 2008 by Credit Agricole SA, a French retail bank, in partnership with Muhammad Yunus, the founder of the Grameen Bank of Bangladesh. The foundation provides funding and technical assistance to microfinance institutions and other social businesses. As of November 2018, GCA Foundation has commitments of approximately EUR 78 million (USD 89 million) outstanding to 76 partners in 35 countries in Africa and Eurasia. Its partners serve 3 million customers, of whom 75 percent are women and 79 percent live in rural areas.

By Tiannah Steele, Research Associate

Sources and Additional Resources

Direct contact with Grameen Credit Agricole Foundation

FINCA Zambia homepage
https://www.finca.co.zm/

FINCA Zambia financial statements
https://www.finca.co.zm/financial-reports/

FINCA Impact Finance homepage
https://www.fincaimpact.com/

FINCA International homepage
https://finca.org/

Grameen Credit Agricole Foundation data
http://gca-foundation.org/the-foundation

MICROCAPITAL BRIEF: “FINCA Forward” to Match Fintech Firms, Microfinance Institutions (MFIs) for New Product Testing
https://www.microcapital.org/microcapital-brief-finca-forward-to-match-fintech-firms-microfinance-institutions-mfis-for-new-product-testing/

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