Egypt’s microfinance deals reached EGP 42.7bn in the third quarter (Q3) of 2020, according to Mona Zulfikar, Chairperson of the Egyptian Microfinance Federation. The quarterly figures represent a growth of 7% for this sector.

Mona Zulfikar, Chairperson of the Egyptian Microfinance Federation

Zulfikar added that the beneficiary base rose by 0.5% to 3.9 million customers in Q3 of 2020.

The non-banking sector including civil society associations, non-governmental organisations (NGOs), and microfinance companies subject to Financial Regulatory Authority (FRA) supervision, provided financing to about 3.1 million clients in Q3 of 2020.

This reflected a growth rate of 0.9% in the number of clients, with outstanding financing increasing by 3.7% to EGP 17.8bn during the comparison period.

Zulfikar indicated that microfinance balances of up to EGP 100,000 directly granted by banks grew by 9.7% in Q3 of 2020, to reach EGP 24.9bn. The banking sector’s customer base recorded 833,000 clients, a slight decrease of 0.9% during the comparison period.

She attributed the growth in microfinance activity to the efforts of state institutions, and the quick and flexible decisions that have been implemented since the beginning of the novel coronavirus (COVID-19) pandemic.

These have been supported by the commitment of microfinance entities to the precautionary measures announced by the state and the FRA.
Zulfikar added that the state’s move to spread the concept of financial inclusion and the vigorous steps to digitise financial services is essential for the business environment. It is ultimately being carried out in the best interests of the national economy.

She expects an industry-wide recovery, especially after the approval of Law No. 201 of 2020 amending some provisions of Law No. 141 of 2014. These will contribute directly to providing more investment and financing opportunities that can be seized by medium, small and micro enterprises (MSMEs).

Zulfikar emphasized the pivotal role of small- and medium-sized enterprises (SMEs) in supporting the economy. The United Nations Development Programmer (UNDP) indicated that these enterprises account for 99% of the total private sector projects in Egypt.

Courtesy by :https://menafn.com/