Proparco, a subsidiary of the French Development Agency’s private sector financing arm, has invested $1 billion in risk-sharing facility agreements with financial institutions, investment funds and a venture capital firm to support micro, small and medium-sized enterprises (MSMEs) in key development sectors.
The $1bn investment that provides loans, equity, guarantees and technical assistance to MSMEs through its intermediaries has financed 39 projects over the 15-year period.
Françoise Lormbard, chief executive officer, Proparco who made this known at a recent press briefing in Lagos, said the development agency is working with intermediaries because they enable them to finance MSMEs they cannot support directly.
According to her, Africa holds the answer to the major challenges of the 21st century and unlocking its entrepreneurial dynamism is at the core of the French Development Agency.
“This is why we aim to concentrate a large share of our resources in the continent. As we mark an important milestone in Nigeria, we are committing to support the African private sector more effectively by enabling entrepreneurs to unleash their potential,” she said.
Lombard added that the focus of Proparco is to support a more sustainable and resilient economy, protect the planet and reduce inequalities in all the geographies it operates.
Over the last 15 years in Nigeria, Proparco has grown to become one of the prominent partners catalyzing growth in the finance, tech, energy, and climate sectors.
Together with its mother company Agence Française de Développement (AFD), the group has successfully supported projects to develop and improve Nigeria’s energy infrastructure, including renewable energy and transmission and distribution networks.
Speaking also, Jean Guyonnet-Dupérat, regional director of Proparco in Nigeria, said Nigerian entrepreneurs are extremely bold with an unshakable dynamism.
“Our commitment as financial partners is to build trust and support them with the expertise and financial tools they need to grow beyond their target. Together, we serve one common objective: building a prosperous and sustainable future.”
George Ogbonnaya, VP and group head of business banking, FCMB, speaking on the support gotten from Proparco, said it has enabled the bank to support MSMEs and women-led businesses with credit.
“We support a lot of agribusinesses with long-term capital and women-led businesses with finance through the support from Proparco and we offer them training.”
In 2021, Proparco supported FCMB to strengthen its commitment to high-impact SMEs and climate projects. The operation consists of a $35 million loan and an EURIZ portfolio guarantee of N5 billion to support the bank’s strategy to serve high-impact SMEs and for climate finance.
The credit facility helped FCMB to support A4&T Power to install 1.5MWp of renewable capacity across mini-grids and customized systems for schools, health facilities, businesses, banks and communities.
Also, Damilola Teidi-Ayoola, head platform and networks, Ventures Platform – an early stage fund that invests in technology companies and another intermediary of Proparco said the development agency is a big deal for her organisation.
“They bring in that brand quality and our clients have access to the value that they bring to us.” “With the support they bring to us, it helps us and our partners to impact more and create value.”
Proparco made a $5 million equity investment into Ventures Platform in 2022 to fill structural gaps by connecting underrepresented communities while improving livelihoods in Africa.
One of the startups already supported by Ventures Platform is Nigeria’s Traction Apps – a tech firm that develops IT tools for SMEs to manage their payments, sales, invoicing and inventories among others.