Finance

Cameroon and Côte d’Ivoire Launch First Inclusive Bonds to Support Small Businesses

Cameroon and Côte d’Ivoire Launch First Inclusive Bonds to Support Small Businesses
Wednesday, 08 January 2025 16:11

With these first issuances, Cameroon and Côte d’Ivoire are pioneering the introduction of this innovative financial mechanism. According to FinAfrique Partners, this model could be replicated in other African countries to support the informal sector and promote sustainable economic growth.

Cameroon and Côte d’Ivoire are preparing to roll out a groundbreaking financing tool called inclusive bonds. These bonds aim to help very small businesses (VSBs) that often struggle to get traditional financing. The initiative is set to begin this year and is being led by FinAfrique Partners, under the leadership of Cameroonian financier Fabrice Kom Tchuente. The focus is on supporting sectors like cross-border trade and small-scale artisanal production.

Inclusive bonds use a creative approach to funding. They rely on a hybrid guarantee system that reduces risks for investors and lowers borrowing costs for small businesses. A group of backers, including governments and international guarantee funds, covers 70% of the financial risks. The remaining 30% comes from the beneficiaries, who provide guarantees through the issuers.

Once the bonds are sold in the capital markets, the money goes directly to small businesses identified by local organizations. These organizations earn a fee for helping distribute the loans and monitoring repayments. The loans last at least 24 months and come with interest rates that are half the usual rates for informal businesses, making them more affordable for small entrepreneurs.

In Cameroon, the first inclusive bond will be issued by ACEP Cameroun, a microfinance institution that is part of the ACEP International network. Société Générale Capital Securities Central Africa will act as the arranger. The bond aims to raise CFA10 billion (about $15.7 million) to fund 1,000 small businesses. Each business is expected to receive an average loan of CFA10 million.

The bond will target businesses involved in cross-border trade and artisanal production. These sectors were selected with the help of Cameroon’s Ministry of Commerce. The funding will help these businesses expand their operations in an environment where access to financing is often limited.

Côte d’Ivoire is also preparing to issue its own inclusive bonds. Credit Access and Witti Finances, two respected microfinance institutions, will lead the effort, with Ecobank Development Corporation (EDC) serving as the arranger. The goal is the same: to raise CFA10 billion and fund 1,000 small businesses.

In Côte d’Ivoire, the focus will be on businesses identified with support from the Ministries of Commerce and Agriculture. The loans will target promising sectors across the country, giving entrepreneurs the resources they need to grow and thrive.

On the same topic
• The IMF has approved an immediate disbursement of $367 million to Ghana, bringing the total financial support provided to the country since May...
Zenith Bank is in advanced talks to acquire a tier-two bank in Kenya. The Central Bank of Kenya has raised capital requirements, triggering market...
• DPI acquires minority stake in Egypt’s largest private hospital group• Funds to support expansion across Egypt and key Gulf countries• Investment among...
WAEMU states collectively raised nearly 7,000 billion CFA francs in the first half of 2025, a record amount driven by increased financing needs, the...
Most Read
01

• Global coffee consumption projected to hit a record 169.4 million 60-kg bags in 2025/2026, up from...

Coffee: Global Consumption Expected to Reach Record Level in 2025/2026
02

• Investors seem to keep focusing on yields, which are high for the moment• New Leadership might see...

Afreximbank Bonds Retain Market Confidence Despite Moody’s Downgrade
03

• Algeria grants commercial 5G licenses to top three telecom operators: Mobilis, Djezzy, and Ooredoo...

Algeria Awards Commercial 5G Licenses
04

• ECOWAS Bank funds 47.7-km stretch of strategic 700-km road project• Lagos-Calabar highway seen boo...

Nigeria Secures $100 mln ECOWAS Bank Loan for Lagos-Calabar Coastal Highway
05

• IFC teams up with AfDB and Nigeria’s EbonyLife to assess a new fund for African cinema• Sector cou...

IFC Plans Investment Fund to Help Grow African Film Industry
Enter your email to receive our newsletter

Ecofin Agency provides daily coverage of nine key African economic sectors: public management, finance, telecoms, agribusiness, mining, energy, transport, communication, and education.
It also designs and manages specialized media, both online and print, for African institutions and publishers.

SALES & ADVERTISING

regie@agenceecofin.com 
Tél: +41 22 301 96 11 
Mob: +41 78 699 13 72
Média kit : Download

EDITORIAL
redaction@agenceecofin.com

More information
Team
Publisher

ECOFIN AGENCY

Mediamania Sarl
Rue du Léman, 6
1201 Geneva
Switzerland

 

Ecofin Agency is a sector-focused economic news agency, founded in December 2010. Its web platform was launched in June 2011. ©Mediamania.

 
 

Please publish modules in offcanvas position.