Founded by Mr. Mouatassim Belghazi, academic and entrepreneur, FONDEP began its operations in Rabat in 1996 as a non-government organization (NGO). It was among the first movers in the Moroccan market to establish a financial institution dedicated to providing credit services to micro and small enterprises. In 2000, FONDEP was granted its license to operate as a microfinance institution (MFI). FONDEP was founded on two main principles: to contribute to the integration of low-income households and individuals into the formal financial system and to contribute to the improvement of the livelihood of such households and individuals

The Guarantee Facility is intended to cover up to 50% of up to MAD210 million worth of credit lines extended by local commercial banks. The Guarantee Facility will partially cover the principal and interest payments and is expected to have a tenor of up to 5 years with 1-year grace period.

9.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee	9.0
Loan
Equity

* These investment figures are indicative

FONDEP’s head office is based in Rabat, Morocco. The company has 176 branch offices located across the country.

Job Creation and Poverty Reduction: The proposed investment is expected to have a high impact in facilitating micro and small enterprises access financial services - an area of key strategic priority to IFC. As IFC assists FONDEP with sourcing additional funding, this project addresses the need to serve those segments of the population that lack the most access to credit; hence seeking to (i) reduce income disparities in the country, and (ii) contribute to job creation in underserved regions. Demonstration Effect and Sector Development: IFC's partial credit guarantee will help mobilize local currency financing for a microfinance institution in a post crisis context thus sending a strong signal to donors and commercial banks, which will help mobilize additional funding to the sector moving forward.

By supporting a Moroccan MFI, that has successfully weathered the crisis, IFC will (a) play a key countercyclical role for the recovery of this critical sector in Morocco; (b) create a strong demonstration effect to help mobilize additional funding for the sector and; (c) signal to other players to move towards more sustainable operations. IFC's guarantee will help FONDEP access local currency and medium term funding from the local market. IFC's presence will give local FIs, more comfort to participate in a larger amount to meet FONDEP's funding needs than they would otherwise consider.

This project involves IFC support for the business of Microfinance, and has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure.

During appraisal, IFC analyzed the FI portfolio, for types of transactions, size, tenor and industry sectors and determined the Applicable Performance Requirements based on an analysis of the potential Social and Environmental risks associated with the FI portfolio and considering IFC’s investment. The Applicable Performance Requirements are:
 The IFC Microfinance Exclusion List; and
 The applicable National Social and Environmental Laws and regulations.

Based on the Applicable Performance Requirements and review of the FI''s existing Social & Environmental Management System (SEMS) and capacity, the project will be required to:
 Provide evidence of implementation of the existing SEMS, prior to commitment to the satisfaction of IFC.
 Continue to retain a qualified person(s) to manage and implement the procedures, prior to commitment.
 Demonstrate commitment and resources to implementing the SEMS procedures and ensure training is provided to staff.
 Demonstrate commitment to applying the labor standards established by the IFC Performance Standard 2: Labor and Working Conditions.
 Submit a periodic report to IFC as per a format to be provided by IFC.