To support nine of its partner microfinance institutions (MFIs) in adapting to the COVID-19 pandemic, the Togolese government’s Fonds National de la Finance Inclusive (FNFI) is taking the following measures: (1) cutting interest rates on its loans to the MFIs by 1 percentage point; and (2) boosting the management fee that the MFIs receive for delivering FNFI products by 1 percentage point.
FNFI offers 10 microloan and insurance products. Its insurance offerings cover personal injury, fire and illness. Its microloan products are designed for income-generating activities including trading, crafting, mechanical repairs, animal husbandry, agriculture and fishing for the following target groups: women, youth, farmers and “poor men and women.” The sizes of these loans range from XOF 40,000 (USD 70) to XOF 5 million (USD 9,000) with terms of 6 months to 3 years. The loans carry fees up to XOF 2,500 (USD 4) and interest rates of 2.5 percent to 10 percent “constant per year.”
Launched in 2014, FNFI’s goals are to continue to support Togo’s Plan National de Development, improve its own services, disseminate best practices, strengthen bank-MFI linkages, and increase the “empowerment of the most vulnerable populations and job creation.”
Since its inception through May 2020, FNFI has funded approximately 1.7 million loans to 1.6 million people totalling XOF 91 billion (USD 15.9 million). This includes XOF 260 million (USD 455,000) disbursed from January 1, 2020, to March 13, 2020. As of 2020, the fund works with 26 partner MFIs.
By Madigan Ruch, Research Associate
Sources and Additional Resources
Togo First article on COVID-19 relief
https://www.togofirst.com/en/finance/2206-5776-covid-19-fnfi-backs-nine-microfinance-institutions
Togo First article on COVID-19 relief (en français)
https://www.togofirst.com/fr/finance/2206-5772-covid-19-le-fnfi-en-soutien-a-neuf-microfinances-partenaires
Togo First article on disbursements during early 2020
https://www.togofirst.com/fr/gouvernance-economique/1903-5160-fnfi-plus-de-260-millions-fcfa-de-credits-debloque-depuis-le-debut-de-l-annee
FNFI homepage
https://fnfi.tg/
FNFI presentation
http://www.fnfi.tg/wp-content/uploads/2014/11/FNFI-PRESENTATION.pdf
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