The Mastercard Foundation, in partnership with Kifiya Financial Technology (Kifiya), announces a scale-up program designed to unlock resources from banks, innovate new financial models and products, and transition the financial sector to enable access to uncollateralized financial credit products for MSMEs.
According to the statement sent to Capital, a budget of USD 100 million is committed to the program.
The Sustainable Access to Finance to Enable Entrepreneurship (SAFEE) program incorporates learnings from Michu, a successful large-scale pilot by the Cooperative Bank of Oromia, Kifiya, and the Mastercard Foundation.
This collaboration enabled more than 148,000 micro, small, and medium enterprises (MSMEs) to access uncollateralized working capital credit in just 14 months.
SAFEE will unlock USD 300 million from six banks and enable more than 477,800 MSMEs to access relevant and appropriate uncollateralized digital credit products, and it will enable 425,000 young women to access mobile device financing.
The program will serve program participants of current and future Foundation programs by unlocking access to uncollateralized working and productive digital credit.
The credit is in the form of nano, micro, and small working capital, inventory credit, invoice financing, equipment financing, and buy-now-pay-later products for MSMEs in urban, peri-urban, and rural areas of Ethiopia.
Over a period of five years, the program will directly drive the creation of job opportunities for 2.18 million young people (80 percent women) and support other programs to enable 3.65 million young people to access credit.
The program is designed to propel supply-side system-level change while addressing demand-side challenges that have traditionally constrained MSMEs’ access to uncollateralized financial services.
The program unlocks resources from banks, innovates new models/products, and ensures that the financial sector transitions to offer uncollateralized financial credit products to a greater number of MSMEs – even beyond the initial program targets.
SAFEE has initially partnered with the Cooperative Bank of Oromia, Bunna Bank, Enat Bank, Amhara Bank, Wegagen Bank, and ZamZam Bank. The facility will increase the number of bank partnerships based on learnings and needs.
