SANAD accelerates support for MSMEs and ends 2022 with over USD 400 million in impactful investments
A combination of local currency loans, strong focus on small businesses and tailored technical assistance enabled the impactful performance of the fund
Luxembourg, January 30, 2023 – The SANAD Fund for MSME (SANAD) is pleased to announce that it has extended its outreach with over USD 400 million of impactful investments across the Middle East and Northern Africa (MENA) and select countries in sub-Saharan Africa (SSA). This notable accomplishment was achieved by partnering with 41 like-minded partner institutions across the region. It reinforces SANAD's dedication to empowering small and medium-sized enterprises through impactful investments and tailored technical assistance support.
The year ended on a positive note with the fund successfully extending a EUR 25 million loan to Bank of Africa, marking the continuation of a strategic partnership to strengthen SMEs with a leading bank in Morocco.
The continued growth of SANAD’s Debt Sub-Fund in 2022 was underpinned by much-needed loans in local currency with over 30% of total disbursements, and deeper outreach to microfinance institutions, which is expected to continue in 2023.
In terms of equity investments, the fund is proud to announce that it invested in Cartona, a leading B2B platform connecting Egyptian retailers with suppliers digitally. Cartona intends to leverage this investment to expand its geographical footprint - creating more equitable access to the B2B marketplace and supporting Cartona’s MSME customers in growing their business and increasing their income. The SANAD Equity sub-Fund (ESF I) successfully divested Global Corp, a leading Egyptian leasing company.
During 2022, SANAD strengthened its impact management framework by introducing a bespoke impact scoring model, enabling SANAD to gain further insight into and optimize the funds impact performance. With over 1 billion in MSME loans enabled to date, the fund’s focus is to continue supporting the growth and development of small businesses in the MENA and SSA.
The impact of the fund was further augmented by the dedicated work of the SANAD Technical Assistance Facility (TAF). The TAF initiated numerous initiatives in MENA and SSA with a strong emphasis on digitalization – representing 46% of newly approved projects. In November 2022 the SANAD TAF released the “Sustainable finance in MENA” report which sets out how microfinance institutions (MFIs) in the MENA region could better support small businesses and the most vulnerable parts of the population to mitigate and adapt to the effects of climate change. The study, first of its kind in the region, is in high demand from MFIs that are motivated to bolster their sustainability capabilities.
2022 also marked the end of the SANAD TAF sponsored Womenpreneur Tour, a multi-year initiative created to highlight the female talents in technology, innovation, and entrepreneurship in the MENA region. During the year the tour visited these female entrepreneurs in Algeria, Egypt, and Lebanon. The SANAD fund promotes strongly female empowerment in the region - 46% of SANAD PI's clients are women and more than 17,000 women benefited directly from the SANAD TA support since the fund’s inception.
SANAD Board Chairperson Dr. Daniela Beckmann said, "We are proud of the progress we have made in 2022 and look forward to continuing our efforts in supporting the growth and development of MSMEs in the core MENA region and select countries in SSA. Our focus on impactful investments and digitalization initiatives has allowed us to effectively channel financing to MSMEs, which are a main growth and employment driver in the region. With this strong accomplishment, SANAD continues delivering on its mission for over a decade and is optimistic to continue this momentum in the coming year.”
The SANAD Fund for MSME is an impact investment vehicle, advised by Finance in Motion, which finances micro, small, and medium enterprises and low-income households in the Middle East and North Africa and selected countries in sub-Saharan Africa via qualified local lenders. SANAD thereby fosters economic development and job creation – including youth employment – agriculture, affordable housing, and innovations in finance and financial technologies. SANAD strives to meet these goals by providing debt and equity financing to its local partners. The SANAD Technical Assistance Facility multiplies the fund’s development impact and outreach through capacity-building with partner institutions, developing financial infrastructures according to the principles of responsible finance and conducting much required R&D.
SANAD’s investors include the KfW Development Bank, which initiated the fund; the German Federal Ministry for Economic Cooperation and Development (BMZ); the European Union; Switzerland’s State Secretariat for Economic Affairs (SECO); OeEB, the Development Bank of Austria; Germany’s GLS Bank and GLS Treuhand; the Dutch development bank FMO; and Calvert Impact Capital.
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