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.
• Global coffee consumption projected to hit a record 169.4 million 60-kg bags in 2025/2026, up from...
• Investors seem to keep focusing on yields, which are high for the moment• New Leadership might see...
• Algeria grants commercial 5G licenses to top three telecom operators: Mobilis, Djezzy, and Ooredoo...
• ECOWAS Bank funds 47.7-km stretch of strategic 700-km road project• Lagos-Calabar highway seen boo...
• IFC teams up with AfDB and Nigeria’s EbonyLife to assess a new fund for African cinema• Sector cou...
As work on the first phase of the Ahmed Sékou Touré International Airport expansion continues, Guinean authorities have announced their intention to move...
• Loulo-Gounkoto mine remains shut as Mali’s administrator seeks to restart it by selling stored gold• Barrick halted operations in January over export...
Hive Coega has officially entered its construction phase, with tenders now out for its core infrastructure. This milestone comes four years after the...
Côte d’Ivoire, the world’s leading cocoa producer, has set an ambitious target: to process 100% of its cocoa crop at the first stage by 2030. While the...
Located about 40 kilometers from Cape Town’s city center, Boulders Beach in Simon’s Town is one of the Cape Peninsula’s most iconic destinations. This...
The Gerewol tradition is a fascinating ritual celebrated by the Bororo Fulani, a nomadic community primarily located in Chad and Niger. This annual...