FPM SA Fonds pour l’Inclusion Financière en RDC

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FPM SA is a refinancing vehicle targeting microfinance institutions and MSME banks in the Democratic Republic of Congo (“DRC”), created jointly with the German development Agency KfW and the Dutch catholic development organization Cordaid. FPM SA aims at providing mid to long term financing to financial institutions targeting MSMEs in DRC, which are indeed facing major difficulties to fund themselves especially on a tenor above one year. FPM SA is a spin-off of FPM asbl, a non-profit association providing capacity building to the financial sector in DRC, that was created end of 2011 by KfW, the United Nations and the World Bank in the frame of DRC’s “Programme d’Appui au Secteur de la MicroFinance” (PASMIF).

FPM SA will gradually constitute a portfolio of loans to sustainable Partner Financial Institutions (“PFIs”) across the financial sector and rely on FPM asbl for the capacity building. In this context, targeted weaker microfinance institutions will first be reinforced through capacity building from FPM asbl, while larger banks will be incentivized to downscale to SMEs. As such, FPM SA will be a unique vehicle to help provide longer term financing to the missing middle (mesofinance).


The Belgian fund manager Incofin IM, a long-standing partner of BIO, will act as advisor to FPM SA.


The development impacts of the FPM have an important trickle-down effect : the long-term loans to be provided by FPM SA will allow institutions to secure and increase their visibility and stability in terms of funding. These institutions will then be in a position to support the projects of their MSME clients on a longer term than currently feasible.

On the other hand, by granting loans to the local and international microfinance institutions, it will help the poorest populations to obtain access to basic financial services, also in rural areas.

By granting loans earmarked for SMEs to the larger banks, it will incentivize these institutions to start working with non-formalised SMEs, thereby improving their access to long term financing.


More information on FPM: www.fpm.cd


  • Investment amount (€):

    €5.8M

  • Contract signature :

    2014

  • Nature of intervention :

    Equity

  • Development impacts :

    • 1 — There is clearly a lack of commercial refinancing possibilities for financial institutions in DRC, especially for tenor above one year. These long-term loans will allow institutions to secure and increase their visibility and stability in terms of funding.
    • 2 — By granting loans to the local and international microfinance institutions, it will help the poorest populations to obtain access to basic financial services, also in rural areas.
    • 3 — By granting loans to the larger banks earmarked for SMEs, it will incentivize these institutions to start working with SMEs, thereby improving their access to long term financing. This will also create a demonstration effect vis-à-vis the other banks in the countries that are absolutely not focused on the MSME segment.
    • 4 —