40839 - RFF ACEP Burkina SL

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Summary of Investment Information

Project Number

40839

Company Name

ACEP BURKINA SA

Date SPI Disclosed

Sep 21, 2020

Country

Burkina Faso

Region

Africa

Environmental Category

FI-3 - No Impact

Status

Active

Last Updated Date

Jun 12, 2021

Department

Regional Industry - FIG Africa

Industry

Financial Markets

Previous Events

Approved : Apr 8, 2020
Signed : Jun 30, 2020
Invested : Dec 10, 2020

Sector

Commercial Banking - Microfinance

Additional Project Attributes

Blended Finance

Project Description

The proposed project is an investment of up to US$4 million equivalent in XOF in the form of a 5-year senior loan to Alliance de Crédit et d'Epargne pour la Production (ACEP) Burkina, aiming at supporting the microfinance institution expand its lending operations in the rural finance and MSME space in Burkina Faso. The project is part of the Phase I of IFC’s Rural Finance Facility (RFF), a platform program being developed by IFC and aiming to support financing of micro, small and medium enterprises (MSMEs) in rural areas, including agri-MSMEs, smallholder farmers (SHFs) and rural value chain operators in FCS and low-income IDA countries, in Africa and the Middle East. The RFF program will be implemented in 2 distinct phases: Phase I will identify and support partner financial institutions (“PFIs”) with an interest in rural finance, and Phase II will focus on supporting farmer cooperatives across multiple value chains to roll-out digitally-enabled finance through partner financial institutions.

The project includes support from the International Development Association’s Private Sector Window Local Currency Facility (IDA-PSW LCF) as described below.

Associated Advisory Engagement

The two phases of investment through the Rural Finance Facility will be coupled with advisory services. The proposed advisory engagement with ACEP Burkina will seek to support the institution improve its risk management and refine its operations through product review and client segmentation.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	14.0
Equity

IFC's loan to the financial institution described in this SII is targeted for on-lending to the following sector(s):

Product Type	Use of Proceeds
Straight Senior Loan	Loans to MSME (mix of Micro and SME)

IFC's Definitions of Targeted Sectors can be found here.

Development Impact

- Project Outcomes Stakeholders effects: improved access to finance for MSMEs, rural/agri MSMEs - in the context of bridging finance gap for MSMEs (incl. WMSMEs and agri-MSMEs located in rural areas) by deploying (i) its products and services and (ii) access to scarce medium- to long-term finance. - Contribution to Market Creation Inclusiveness: by demonstrating to other FIs the viability of product offerings and digital channels that meet the funding needs of rural and agri MSMEs in remote locations.

Financial additionality Financing Structure: Provision of medium-term (5 year) stable local currency financing that is not readily available in the market and will ease liquidity pressures. IFC's financing will help diversify the borrowing profile and extend maturity of its lending. Non-financial additionality Knowledge, innovation, and capacity building, with AS focusing on (i) client segmentation and product review, (ii) financial risk management, (iii) agri and rural finance, and (iv) digital finance.

E&S Category Rationale / Risks and Mitigation

The project has been categorized as FI-3 according to IFC’s Environmental and Social Sustainability Policy. Through ACEP Burkina, the project will support smallholder farmers and rural value chain operators in Burkina Faso. These activities do not pose significant E&S risks and impacts; the risks and impacts associated with these activities are mostly minimal. The overall portfolio risk for this project is therefore considered low. The applicable requirements for this project are the IFC Exclusion List and applicable national environmental and social laws and regulations in Burkina Faso. For this project, the bank will be required to develop an ESMS that covers the applicable requirements to ensure that E&S risk and impacts associated with its lending activities are systematically assessed as part of the credit approval and monitoring process. In addition, the bank will be required to appoint a suitably-qualified E&S Officer and provide appropriate E&S risk management training to its officers to ensure effective implementation of the ESMS.

Contacts

For Inquiries About the Project, Contact

ACEP Burkina
Ousseni Kirakoya
CEO
+226 70 23 03 82 / 64 09 97 57
dg@acep-burkina.com
Koulouba Ouaga BF-KAD BF-03, Ouagadougou - Burkina Faso
acep-burkina.business.site

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