Aswan/Cairo, Egypt, 27 October 2008 – The First Microfinance Foundation (FMF), a subsidiary of the Aga Khan Agency for Microfinance (AKAM), and the United States Agency for International Development (USAID), have signed an agreement that will increase microfinance support to poor and low income families and small businesses in the Aswan Governorate. At present, the Aswan Governorate has one of the lowest levels of access to microfinance in Egypt.
Since 2006, FMF has provided over 23,000 loans worth 45 million Egyptian pounds to small businesses in Aswan, with a repayment rate of 99 percent. USAID will help scale up and sustain operations by providing a credit guarantee, worth 20 million Egyptian pounds, which will allow FMF to extend an additional 80,000 loans. FMF’s regional network will expand to nine cities and cover 75 percent of Aswan Governorate's villages.
On 27 October 2008, AKAM and Deutsche Bank hosted the Egypt Microfinance Leaders Meeting in the presence of Her Royal Highness Princess Máxima of the Netherlands and Prince Rahim Aga Khan. The event drew over 40 participants from the government, private sector, development associations and the international community.
The Princess, speaking as a representative of the UN Advisors Group on Inclusive Financial Sectors, highlighted the importance of increasing access to safe savings services for poor and low-income households. Jacques Toureille, General Manager of AKAM and member of the Group, spoke on the importance of expanding microfinance services to rural areas where a large proportion of Egypt's poor live.
The goal of the forum was to provide a venue for participants to discuss the challenges facing further development of microfinance in Egypt. Participants highlighted the need for a dedicated regulatory framework that would allow for institutions to incorporate as limited liability companies, diverse their product offering and diversify their sources of funding – particularly through the mobilization of savings.
The Advisors Group consists of 25 individuals representing governments, central banks, regulatory agencies, microfinance institutions, private sector financial institutions, civil society, development agencies and donors, and academia from all over the world. The main role of the Advisors Group is to advise the United Nations system and member states on global issues relating to inclusive finance.
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