Baobab MicroCred LCY multi-country facility (IFC-39996)

Countries
  • Burkina Faso
  • Congo, Democratic Republic of
  • Ivory Coast
  • Madagascar
  • Nigeria
  • Senegal
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Proposed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
U
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Jun 24, 2019
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
BAOBAB
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Finance
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 21.10 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Jun 13, 2019

Disclosed by Bank May 24, 2019

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to bank documents, the proposed project consists of a multi-currency facility of an aggregate amount of US$21.1 million equivalent to six African affiliates of the Baobab Group, one of the leading global microfinance networks with operations in nine African countries and China. The program includes support to the following subsidiaries, for on-lending to micro, small and medium enterprises (MSMEs): Senegal, Cote d’Ivoire, Madagascar, Nigeria, Burkina Faso and Democratic Republic of Congo.

People Affected By This Project
People Affected By This Project refers to the communities of people likely to be affected positively or negatively by a project.

The most significant, expected Project-level outcome is increased access to finance including at longer terms by underserved MSMEs including Women owned MSMEs (WSMEs). Beyond the Project, IFC anticipates that the Project has the potential to promote greater market inclusiveness via demonstration and replication channels.
Development Impact is expected to be measured based on the following factors:
- Stakeholders effects: change in accessibility - in the context of bridging finance gap for MSMEs (incl. WMSMEs and agri-MSMEs located in rural areas) in six countries by deploying (i) its products and services and (ii) access to scarce medium- to long-term finance.
- Stakeholder effects: change in affordability of finance for MSMEs - by (i) deploying digital channels, agent network along with multiple products offering to lower the access to finance cost for MSMEs.
- Inclusiveness: by demonstrating to other Financial Institutions the viability of product offerings and digital channels that meet the funding needs of WMSMEs and MSMEs in remote locations.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

IFC’s investment will be in the form of senior loans of an aggregate amount of US$21.1 million equivalent to the six Baobab subsidiaries considered under the Project, allocated as follows:

• Baobab Senegal: Senior loan of up to US$7.0 million equivalent in XOF with 5-year tenor.

• Baobab Côte d’Ivoire: Senior loan of up to US$5.0 million equivalent in XOF with 5-year tenor

• Baobab Madagascar: Senior loan of up to US$4.0 million equivalent in MGA with 5-year tenor

• Baobab Nigeria: Senior loan of up to US$1.8 million equivalent in NGN with 5-year tenor

• Baobab Burkina Faso: Senior loan of up to US$1.8 million equivalent in XOF with 3-year tenor

• Baobab Democratic Republic of Congo: Senior loan of up to US$1.3 million with 3-year tenor

The project will be supported by the IDA IFC-MIGA Private Sector Window (PSW) to enable the provision of local currency and US$ financing at the required terms in order to unlock financing for MSMEs. Up to US$19.8 million will be provided from the PSW Local Currency Facility, which provides financing in local currency for high impact projects where local currency solutions are underdeveloped or missing. In addition, up to US$0.75 million from the PSW Blended Finance Facility will be structured as a senior concessional loan to Baobab Democratic Republic of Congo.

Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

The project is implemented by Baobab, a longstanding partner of IFC, as one of the first microfinance networks to implement the 2006 Microfinance Initiative for Sub-Saharan Africa. IFC was a founding shareholder of Baobab until divestment in 2014 and has invested in 6 subsidiaries in Africa and China. Baobab’s performance in Africa in the past 10 years has been positive with sustained growth and impact in frontier and FCS markets such as Mali, Democratic Republic of Congo and Zimbabwe. Baobab offers a complete range of financial services, including credit products ranging from US$10 to US$300,000; savings and insurance for low-income individuals; payments and transfers. The selected subsidiaries represent leading players in their respective markets and an opportunity for IFC to reach multiple financial inclusion operators in an efficient manner.

Private Actor 1 Private Actor 1 Role Private Actor 1 Sector Relation Private Actor 2 Private Actor 2 Role Private Actor 2 Sector
- - - - Baobab Group Client -

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

Baobab Group 
Gregoire Lecomte 
Group Head of Investor Relations & Funding 
+33 1 85 73 19 14 
glecomte@baobab.bz 
1, rue de Gramont, 75002 Paris - France 
www.baobab.bz 

ACCOUNTABILITY MECHANISM OF IFC

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org. You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org/

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How it works