Guatemala, Senegal, Burkina Faso, Senegal

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

August 2018 – August 2023
 

Project Overview

Although financial cooperatives are uniquely positioned to deliver livelihood-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 finance. 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 FinanceToolkit, 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). The project expanded operations to Senegal in October 2020 where it is working with Union des Mutuelles du Partenariat pour la Mobilisation de l'Epargne et du Crédit au Senegal (UM-PAMECAS). These partners represent and provide technical support to multi-million-member networks of credit unions. 

The World Council SME Finance Toolkit is designed to:

  • Reduce lending risk by credit unions to SMEs, who often do not have formal or documented credit histories and who may not be able to provide the same types of documentation and collateral that are required for more traditional loans
  • Streamline and simplify the SME lending process, thereby reducing costs of lending to SMEs
  • Increase the number and quality of financial products available to SMEs, thereby increasing SME financial inclusion
Quarterly Update (September 2020)

While the COVID-19 pandemic continued to require significant adjustments to our operational plans, both in how we work and what we do in response to the needs, the TIFI project successfully continued with project implementation across all four countries.  

  • TIFI Kenya: TIFI developed twenty-five technical reference guides related to SME financing; carried out a diagnostic survey of SME finance readiness with 55 SACCOs, of which 35 were identified as potential partners; and supported KUSCCO’s delivery of virtual trainings on SME finance. The first of the three weeks of training reached 225 people from 16 SACCOs—48 for the session for board members, 83 for the credit manager/branch managers session, and 94 for the credit officers’ session. 80 SACCO leaders attended a training by Kassandra Schroeder with Andrew Price on virtual AGMs. 
  • TIFI West Africa (Burkina Faso & Senegal): TIFI is supporting a “Hackathon” fintech competition with CIF to provide digital solutions to SME lending in agricultural value chains, with COP Susy Cheston and VP Megan O’Donnell representing WOCCU on the Jury. TIFI compiled a list of analysis tools and resources used across Burkina to train Loan Officers on SME Lending and completed a “training of trainers” for the CIF staff on the Excel financial analysis.  
  • TIFI Guatemala: An in-depth market study with a gender lens is underway. In the first phase, TIFI received comprehensive desk research on the current SME market in Guatemala, the strengths and weakness of the credit union system, market opportunities for financing, and current digital channels offered in Guatemala. Digitization and testing of the new loan application software is near completion. TIFI developed materials for 10 sessions of virtual training on SME finance.
In addition to the toolkit development in TIFI's four priority countries, following feedback from over twenty countries, the project also continued to develop a tool for liquidity management and interest rate management. The tool was reviewed by a global working group in July 2020; modified to include additional aspects of interest rate management and ALM; and presented in mid-September to a working group of six technical staff from Latin American credit unions to gauge application and utility. A further refinement, translation, and global review are proposed for the next quarter and into 2021.

Credit Unions in Burkina Faso

  • 76 total credit unions
  • 1,409,682 million members (9.90% of the population)
  • USD 427 million in assets

Credit Unions in Guatemala

  • 25 total credit unions
  • 2.1 million members (12.41% of the population)
  • USD 2.4 billion in assets

Credit Unions in Kenya

  • 8,033 total credit unions
  • 8.5 million members (14.98% of the population)
  • USD 10 billion in assets

Credit Unions in Senegal

  • 98 total credit unions
  • 2.98 million members (18.80% of the population)
  • USD 705 million in loans
Funded by