Civil society organizations and financing institutions are adjusting their strategies to navigate the challenges of Egypt’s current economic landscape, as stated by Mona Zulficar, Chairperson of the Egyptian Medium, Small, and Micro-Enterprise Finance Federation, to Daily News Egypt. By focusing on balancing sustainability with client protection, these organizations aim to improve service quality, build sector trust, and support market stability.
Impressive Growth in Client Funding
By the end of Q3 2024, Egypt’s financing agencies had disbursed EGP 95.5 billion to around 4.5 million clients. This achievement reflects a growing sector, even amid economic difficulties. Zulficar shared that civil society institutions and associations within the Federation had served 1.8 million clients, providing EGP 20.7 billion in funding. Microfinance companies, in turn, reached 1.9 million clients, distributing EGP 38.8 billion.
The Role of the Banking Sector
The banking sector also played a significant role, funding 744,000 clients with EGP 36 billion by September 2024. Of this, EGP 11.4 billion went to 242,000 individuals, contributing to the broader reach of microfinance across the country.
Diversification of Financial Products
Zulficar emphasized that microfinance agencies are diversifying their offerings to better serve their clients. Many are tailoring their products to meet the unique needs of different segments. Additionally, eight Federation members have received licenses to finance small and medium enterprises (SMEs). Together, they have reached 9,400 customers, with EGP 11.8 billion in financing distributed during Q3 2024.
Looking Ahead: A Promising Future for MSME Financing
Zulficar expressed optimism about the future growth of the micro, small, and medium enterprise (MSME) financing market. She pointed to the proactive efforts of the Financial Regulatory Authority (FRA) and the Central Bank of Egypt (CBE). Their innovative approaches to financing have improved access to capital for previously underserved social groups. This progress, Zulficar noted, should lead to continued growth in the sector in the years ahead.
