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Proparco acquires 10 percent stake in financial services firm Finafrica
Finafrica, a Pan-African provider of microfinance and insurance services and a subsidiary of Groupe Duval, has announced a significant milestone in its growth journey with the entry of Proparco as a strategic investor, acquiring a 10% stake in the company.
Established in 2018 under the umbrella of the Duval Group, Finafrica has been dedicated to fostering financial and insurance inclusion across Africa. By offering tailored financing solutions and protection against life's uncertainties, Finafrica empowers entrepreneurs and enhances financial access for underserved communities.
The partnership with Proparco, a subsidiary of the Agence Française de Développement (AFD) focused on private sector, underscores Finafrica's commitment to accelerating its expansion. This 10% stake investment is made through FISEA, the AFD Group's facility, implemented by Proparco as part of the Choose Africa initiative.
With a presence in Guinea, Cameroon, Senegal, Côte d'Ivoire and Rwanda, Finafrica will thus strengthen its network and extend its reach across sub-Saharan Africa and thereby promote financial and insurance inclusion in its host countries. This strategic collaboration aims to address pressing challenges: as of 2021, nearly 45% of the sub-Saharan African population lacked access to formal financial services, while insurance penetration remained at a mere 2%, compared with 7% worldwide.
As first microfinance network offering insurance services, Finafrica is committed to advancing sustainable and resilient economic development in Africa by providing better protection for microentrepreneurs (including their households), lower cost of credit for insured loans and better monitoring of the cost of risk for microfinance institutions.
By joining forces with the AFD Group, Finafrica will also benefit from technical support in terms of social performance, aimed at strengthening mechanisms for preventing excessive debt and developing responsible pricing.
Louis-Victor Duval, Deputy Managing Director of Groupe Duval: "Proparco's investment in Finafrica is a significant milestone for our family-owned group. We look forward to working together in the future to support Finafrica's sustainable development agenda in Africa. Sharing common values and objectives around social performance, Proparco is a strategic partner for our continuing growth."
Françoise Lombard, CEO of Proparco: "Through its investment in Finafrica, Proparco proudly reaffirms its collaboration with Groupe Duval, a valued partner since 2018, and commits to advancing the implementation of its subsidiary's strategy in sub-Saharan Africa. By offering both microfinance and insurance services to the continent's entrepreneurs, Finafrica's action strongly echoes the ambitions carried by Proparco: to act for a sustainable economy and strengthen resilience of local ecosystems in Africa."
By supporting the establishment of an innovative financial inclusion network backed by a strong sponsor, this operation contributes to enhancing access to essential services for people living at the bottom of the pyramid - young people and women in particular - but also for the agricultural sector. The project will contribute to advancing the United Nations Sustainable Development Goals (SDGs) #1 (No poverty), #8 (Decent work and economic growth) and #10 (Reduced inequalities).
