BIO supports SMEs in Benin

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Upon invitation by the Beninese Minister for Industry, Trade and SME, Luuk Zonneveld, BIO’s CEO, and Dimitry van Raemdonck, Senior Investment Officer at BIO, conducted a prospection mission in Benin last week. It was an opportunity for BIO to value its support to the private sector in Benin and more particularly to SMEs.

Until very recently, BIO was only indirectly present in Benin, as shareholder of BOA group and Oragroup, through investments in Ecobank Transnational, as well as the microfinance fund Regmifa, which in turn committed loans to Finadev Benin and Vital Finance.

Only recently did BIO also step in as direct investor in Benin, by lending 3 million EUR to “Comptoir de Distribution de Produits Agro-alimentaires S.A.R.L.”, a poultry project, at the beginning of 2013.

The aim of the mission was to identify growing enterprises seeking mid or long term financing. BIO was looking for companies that are already well structured and can manage initial financing of around one million EUR. Most Beninese companies do not answer to those criteria, which is why BIO is looking to reinforce its presence in the local financial sector through participation in banks.

The main benefit of BIO’s financing for local enterprises is the life span of the loan: Beninese SMEs have access to credit through local banks, but these do not usually rhyme with long-term investment projects. While local banks offer loans on 3 -4 years’ basis, BIO can go well beyond that. BIO aims at offering additional solutions to those offered by local banks, in order to reinforce the productive economic network of the country.

The files that were withheld at the end of the mission, will be further analyzed and could lead to a future direct investment.