Working together on
microfinance and microinsurance
microfinance and microinsurance
In the 1990s, Ousmane Thiongane was captain of the Senegal national football team. But he wanted to make a difference in the world and microfinancing was key to that. Ousmane has now been running U-IMCEC, one of the largest microfinancing institutions of his West African homeland, for nearly 15 years. In BRS he found the ideal partner to enable U-IMCEC to grow in agricultural finance.
Senegal is a stable democracy and the country is in full development. BRS had not yet run a project there until recently, but is now offering three years of support to U-IMCEC (Union des Institutions Mutualistes Communautaires d’Epargne et de Crédit). This cooperative microfinancing institution served approximately 174,630 customers at the end of December 2019, thanks to its 265 employees and 45 branches.
It started out as a savings and credits agency. Its work was already pioneering at the time, as savings were invariably kept in a cupboard or under the bed.
Ousmane Thiongane: “Fortunately, things are different today and customers are proud to have a bank account.
U-IMCEC originated as a spin-off of an NGO that takes care of disowned children by supporting the mothers. This is why we also focus on the same vulnerable target group of young people and women, both in rural and in suburban areas. Our aim is to improve their income, and therefore their well-being, by giving them access to appropriate financial services."
Ousmane Thiongane wants to provide as many customers as possible with access to ever better financial services tailored to their needs: “Moreover, we are very flexible and provide market information as well as financial resources and we play a mediating role regarding access to seed or fertiliser. We also continue to focus on educating our customers: we teach them to compare credits, how to plan their repayments and how to calculate their profits.”
In order to combat the rural flight to the capital city of Dakar, other big cities and agglomerations, the Senegalese government has for a number of years now concentrated its efforts on agriculture, both for domestic consumption and for export. In response, U-IMCEC decided to strengthen its knowledge of agricultural finance and to support farmers as much as possible in their growth. The cooperative wants to increase the share of farmers in its portfolio from 20% to 45% through new, customised financial products. With the expertise of BRS, this is becoming a reality. In order to take the financial services for farmers to a higher level, they needed support.
Ousmane Thiongane: “I knew BRS, Cera and KBC through my visits to Europe and also knew that BRS could help us professionalise and develop these services.
Our collaboration began at the end of last year with a workshop to improve the technical knowledge of all our employees. Since then, BRS has supported us with answers to questions such as: how do you best organise an agricultural department as a bank? How does such a coherent approach evolve? What is a healthy agricultural portfolio and how do you determine the best ratio between, for example, the number of rice farmers and the number of poultry farmers in your portfolio? ... BRS does this by exchanging experience, drawing up action plans, monitoring our development, and providing advice in case of obstacles. We have video calls every two weeks and BRS visits us twice a year."
Like every country, Senegal has had to cope with the coronavirus the spring of 2019. The country had 7,400 infections and 60 deaths from the virus between the end of March and the start of July. Due to the lockdown, economic activities slowed or stopped and the population lived from day to day. The impact on the microfinancing sector was considerable. On the one hand, in times of crisis, customer demand for credit increases to bridge the period with less income, and on the other hand, account holders want to withdraw their money (bank run). This creates a double stretch. The impact of the pandemic is mainly due to the fall in deposits, the massive withdrawal of savings, an increase in arrears, a decrease in credit production and a huge loss on financial products due to the postponement of payment deadlines.
BRS’ support during this challenging period full of change for our employees and customers meant a great deal.
Ousmane Thiongane: “Not least moral support, because customers stayed away in droves. And we also had to rethink our way of working. Teleworking became the norm and all meetings took place via Zoom and Skype.
Now, some two months after the lockdown was lifted, we are experiencing a big rush. We are right in the middle of the sowing period and the farmers want credits to buy agricultural material. The festival of Eid al-Adha is also approaching (editor’s note: Senegal is predominantly Muslim) and “festival” means “business”. We want to be there for these entrepreneurs.”
The coronavirus crisis has changed the way we work forever.
Ousmane Thiongane: “Digital transformation has saved us and is here to stay. Long journeys for meetings lasting only two to three hours have been definitively replaced by video meetings. And our office staff now regularly pop in on our customers at their homes, with a tablet under their arm! In this way, we play even more on our strength of proximity and continue to distinguish ourselves from our competitors. We also started sending text messages to our customers during the lockdown to maintain contact. We send them a text message on their birthday or to inform them about our financial services.”
U-IMCEC has grown to become one of the largest microfinancing institutions in Senegal, with a good relationship with the government, the many NGOs that are active and, like them, with the aim of combating poverty.
Ousmane Thiongane: “We are very grateful for the partnership with BRS and want to continue to maintain it as best we can. To continue to grow and become a reference in terms of agricultural finance, offering innovative financial products. All for the benefit of our customers who deserve a promising future.”
