Cooperative Development Program: Technology and Innovation for Financial Inclusion (CDP TIFI)

August 2018 – August 2023
Kenya, Guatemala, Burkina Faso

 

Project Overview

Although financial cooperatives are uniquely positioned to deliver likelihood-enhancing financial services including savings, credit, and insurance, evidence shows that there is significant unmet demand for small and medium enterprise (SME) credit in developing countries. This is in part because financial cooperatives and credit unions do not have the capacity and tools to deliver SME credit. Only six to eight percent of adults in CDP TIFI target countries have access to credit, compared to 11 percent globally and 34 percent in the United States (World Bank Global Findex 2017, https://globalfindex.worldbank.org/). Women, youths, and rural adults have even lower access to credit than average.

The CDP TIFI activity, funded by USAID will increase lending to small and medium enterprises (SMEs) by deploying the World Council SME Lending Toolkit, starting in three countries – Burkina Faso, Guatemala, and Kenya – each with its own key partner: Confédération des Institutions Financières de l’Afrique de l’Ouest (Confederation of Financial Institutions of West Africa, CIF), Federación Nacional de Cooperativas de Ahorro y Crédito (National Federation of Savings and Credit Cooperatives, FENACOAC), and the Kenyan Union of Savings and Credit Cooperatives (KUSCCO). These partners represent and provide technical support to multi-million-member networks of credit unions.

The World Council SME Lending Toolkit is designed to:

Quarterly Update (April 2019)

During the past quarter, WOCCU escalated start-up activities. We formalized and finalized our relationships with our partners FENACOAC, CIF, and KUSCCO. WOCCU is currently in the process of assessing their and their members’ digital capabilities and preparedness for digital transformation. In Guatemala, WOCCU supported FENACOAC to begin the process of establishing a credit union service organization (CUSO) that will allow FENACOAC’s member credit unions to more easily lend to SMEs within Guatemala’s restrictive regulatory environment, which currently does not allow credit unions to lend to firms (only individuals). As WOCCU continues development of the SME Lending Toolkit and adapts it to the local technical and lending capabilities and languages of the national associations and credit unions in each country, our partners have begun the selection process for pilot credit unions that will test the SME Lending Toolkit.

In the upcoming quarter, WOCCU will continue to develop and refine the SME Lending Toolkit with the goal of having the first pilot loans issued using the Toolkit at the end of the quarter or beginning of the next quarter. Market, financial, and legal studies will be conducted in each country.

Funded by