By targeting micro, small and medium enterprises (MSMEs) in a fragile region, SANAD fosters economic development and job creation – including youth employment – thereby contributing to stability. Since its inception, SANAD financing to local partners has funded more than 83,000 loans, the large majority of which were microloans.

FMO is providing financing to SANAD through an investment of USD 15 million in the senior tranche of the debt sub-fund, money that will be on-lent by local partners to MSMEs. The investment comes from the MASSIF Fund, which FMO manages on behalf of the Dutch Ministry of Foreign Affairs. “MASSIF provides much needed financial and non-financial resources to small businesses and micro-entrepreneurs by supporting local financial intermediaries and institutions that can contribute to their development. MASSIF invests in low income countries and fragile and conflict-affected states with special focus towards rural areas, women, youth and companies that are developing new innovative products and services for the so- called ‘Base of the Pyramid’. Supporting SANAD is an important step for MASSIF to further support entrepreneurs and SMEs in this (conflict) affected part of the world”, explains Jeroen Harteveld, Fund manager of MASSIF.

SANAD Board Chairman Wolfgang Reuss said: “We are delighted that FMO is investing in our ongoing support of small businesses in the Middle East and North Africa. The bank’s commitment should also allow us to attract further financing so we can continue bolstering the development of MSMEs and youth job creation in the low- and middle-income regions the fund serves.”

“SANAD” means “support” in Arabic, and the fund seeks to promote stability in a challenging region by expanding financial inclusion for MSMEs that often have difficulties finding access to capital for starting or growing a business. SANAD loans to local financial institutions are on-lent to support MSMEs in multiple sectors, and the fund is currently examining expansions in areas such as agribusiness, housing, and youth and gender initiatives.

Due to conflict and instability, the MENA region is a challenging region for investors. Financing in MENA is provided mainly to larger companies, while employment is largely driven by MSMEs. Given the developmental challenges resulting from the region’s current situation and the need for MSME financing, FMO has increased its activities in the region’s financial sector, to provide scarce financing for further economic, sustainable, and social development. The investment fits further efforts and activities of the Dutch Government to support economies in the MENA region, specifically in countries which deal with a strong influx of refugees.