MICROCAPITAL BRIEF: Incofin Lending $1m to EFC Uganda to Support Micro-, Small, Medium-Sized Enterprises; to Advise on Social Performance

Belgium-based Incofin Investment Management recently disbursed the initial USD 1 million of a “multi-million dollar” loan package for Entrepreneur Financial Centre (EFC) Uganda. EFC Uganda’s target market is micro-, small and medium-sized enterprises (MSMEs). Incofin made the investment through its agriculture-focused fund, agRIF. I&M Burbidge Capital, a Nairobi based company was the lead advisor to EFC Uganda for this transaction.

Myrtho Vlastou, Incofin’s debt director for Africa, stated, “We are happy to have inaugurated this partnership with EFC Uganda, a company that has demonstrated its high growth potential and capacity to empower MSMEs in Uganda. Incofin will also support EFC Uganda in strengthening its social performance management.”

Founded in 2012, EFC Uganda is a microfinance institution based in the city of Kampala that provides savings accounts; loans for financing agricultural supplies, inventory, equipment, home improvements; and mobile payment services to 10,000 customers via eight service locations. As of December 2019, the institution had total assets of UGX 56 billion (USD 15 million). The organization is one of multiple EFCs supported by Développement international Desjardins (DiD), a unit of the Canadian cooperative Desjardins Group. EFC Uganda’s other investors are AfricInvest, ASN-Novib Microcredit Fund, Bamboo Capital, the Belgian Investment Company for Developing Countries (BIO) and the Uganda Gatsby Trust.

Founded in 1970, DiD is a Canadian nonprofit corporation that seeks “to provide disadvantaged communities around the world with access to secure, diversified financial services.” It specializes in providing technical support and investment for the community finance sector. The NGO has worked in 65 nations across Africa, Asia, the Caribbean, Central and Eastern Europe and Latin America. DiD has CAD 50 million (USD 39 million) in funds under management as of 2020, including the Aequitas fund, which DiD subsidiary Fonidi Management launched in 2020.

Desjardins Group serves 7 million members and clients with services such as retail banking, wealth management, securities brokerage, venture capital and asset management. As of June 2020, the group reports total assets of CAD 350 billion (USD 266 billion), a gross loan portfolio of CAD 207 billion (USD 157 billion) and deposits of CAD 220 billion (USD 167 billion).

Founded in 2001, Incofin is a for-profit firm that seeks “to promote inclusive progress.” It has 320 investees in 66 countries, mostly active in financial inclusion and agriculture as of 2021. Incofin’s portfolio is valued at USD 1 billion as of 2021 and comprises the following funds: agRIF, BRS Microfinance Coop Fund, Fairtrade Access Fund, Fonds pour l’Inclusion Financière en République Démocratique Congo (FPM), Incofin CVSO, Invest in Visions, Rural Impulse Fund (RIF) II, Volksvermogen and a loan portfolio of vdk bank.

By Aakansha Shenoy, Research Associate

Sources and Additional Resources

Incofin press release
https://incofin.com/incofins-agrif-fund-invests-in-efc-uganda/

EFC Uganda homepage
https://efcug.com/

DiD home page
http://did.qc.ca/

Desjardins homepage
https://www.desjardins.com/

Incofin homepage
https://incofin.com/

I&M Burbidge Capital homepage
http://www.imburbidgecapital.com/

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