The Board of Directors of the African Development Bank has given a green light on Tuesday, September 25, 2018, in Abidjan, for a € 15 million equity investment in the FIVE (Financial inclusion vehicle) fund, an instrument of financial inclusion set up in 2017 by the AfricInvest group.
An evolving fund with a capital of 200 million euros, FIVE is to take stakes and quasi-stakes (in the form of financing) in medium-sized banks (so-called second-class financial institutions) and small third category). The aim is to help them achieve their digital transformation and encourage them to grant loans to African SMEs, which are currently suffering from a funding gap.
The African Development Bank has decided to take a € 15 million stake in the FIVE Fund to help drive the digital transformation of financial institutions in Africa and enable them to take advantage of developments and opportunities in Africa. sector.
FIVE will support the digital transformation of these banks by providing them with strategic advice and capital, and helping them to optimize their governance and operations. The fund will also help them enter into partnerships with, for example, traditional insurance companies, mobile network operators, money transfer companies.
Specifically, the FIVE fund invests equity and convertible debt in financial institutions that need to increase their balance sheets and integrate technologies that allow them to expand their service offerings to unbanked populations.
Among the institutions targeted by the FIVE fund are traditional financial institutions (commercial banks lending to SMEs, insurance companies offering low-cost products), as well as financial technology companies (Fintech) that exploit technology to offer digital financial services and mobile network operators.
About the Africinvest Fund
Founded in 1994, AfricInvest is a pan-African private equity group with nine offices, including seven in Africa, which invests in small and medium-sized enterprises that can grow on the African continent.
