Microfinance November 6th, 2013
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Keynote Speakers
Speaker Company and Function
Sophie Manigart
Prof. Dr. Ir. Vlerick Business School
Loïc De Cannière Managing Director, Incofin
Luc Haegemans Secretary General & Member of the Executive Committee of BNP Paribas Fortis
Marion Cahen Manager, Microstart Gent
Philippe Duhamel Head of credits of Hefboom - Impulskrediet
AGENDA
Welcome - by Vlerick Finance Alumni
Introduction to tonight’s debate – by Prof. Dr. Ir. Manigart
Incofin - Microfinance: Definition, Investment funds and Incofin IM
Microfinance at BNP Paribas Fortis
MicroStart - “Klein krediet voor grote plannen”
Impulskrediet - “Because your projects deserve our support”
Q&A
Networking reception
5
Loïc De Cannière
CEO, Incofin Investment Management
Luc Haegemans
Secretary General & Member of the Executive Committee
BNP Paribas Fortis
Microfinance at BNP Paribas Fortis
Responsible Engaged Bank Platform
November 2013
Agenda
CSR
Microfinance to fight poverty, financial & social exclusion
Group support to microfinance
microStart
Volunteership
Incofin - Rural Impulse Fund II
4 pillars
12 Commitments
CSR : 4 pillars & 12 commitments
Microfinance to fight poverty, financial & social exclusion
Microfinance allows to achieve at the same time various objectives:
Financial Inclusion:
• Providing small loans for productive investments purpose to people that do not have access to the traditional financial system.
Social inclusion:
• Targeting women and minority groups
Microfinance as an instrument to achieve the UN Development Goals
Solidarity opportunity :
• Volunteership program for employees, who are highly motivated to help microfinance institutions (MFI’s).
Group support to microfinance in 2012 : 78,8 M€
12
Investissement products proposed to customers: 10,4 M€
out of which:
Obli Etheis ResponsAbility (retail) 6,2 M€
ResponsAbility (WM) 4,2 M€
‘Epargne salariale’ : 9,25 M€ out of which
SIFA France Active 4,8 M€
Adie 3,7 M€
France initiatives 500 k€
SIDI 250 K€
Donations to IMF : 1,52 M€ out of which Adie 1,15 M€
France Initiatives 216 k€
Planète Finance 125 k€
Microstart 30 k€
Investissements in Equity (cumul ) : 7,4 M€ out of which
Microstart 2,36 M€
Per Micro 1,5 M€
LMDF 1,05 M€
Rural Impulse II 1,25 M€
Planet Guarantee 625 k€
Microcred Côte d'Ivoire 500 k€
Gamifi (Gabon) 100 k€
Taysir (Tunisie) 185 K€
Financements
Epargne clients
Epargne salariale
Dons
Fonds propres
Micro crédits personnels
Credits : 49,7 M€ out of which
Emerging Markest 33 M€
Domestic Markets + RU 16,7 M€ ‘Micro-crédits personnels’ : 0,5M€
Group support to microfinance in june 2013 : 123 M€
13
Investissement products proposed to customers : 14,4M€
out of which:
Obli Etheis ResponsAbility (retail) 7,8 M€
ResponsAbility (WM) 4,9 M€
Proximité (FIP) 1,7M€ (BNP PE dans SIFA)
‘Epargne salariale’ : 14,7 M€ out of which
SIFA France Active 9,15 M€
Adie 3,7 M€
Initiative France 500 k€
SIDI 250 K€
ACTED 1,04 M€
Donations to IMF : 1,9M€ out of which
Adie 1,15 M€
Initiative France 216 k€
Microstart 30 k€
BoW 550k€
Investissements in Equity (cumul ) : 7,9 M€ out of which
Microstart 2,36 M€
Per Micro 1,75 M€
LMDF 1,05 M€
Rural Impulse II 1,25 M€
Planet Guarantee 625 k€
Microcred Côte d'Ivoire 500 k€
Gamifi (Gabon) 100 k€
Taysir (Tunisie) 185 K€
Alterfin (Belgique) 50 k€
Credits : 79,5 M€ of which:
Emerging Markets 44,5 M€
Domestic Markets + RU 35 M€
‘Micro-crédits personnels’ : 0,5M€
Micro-insurance : 3,9M€
microStart
An innovative enterprise to
promote social cohesion
microStart
Overall statistics on August 31, 2013:
4 branches (BXL, Gent, Luik)
1050 entrepreneurs met
250 projects already financed
Average micro-loan = EUR 4700
90% of entrepreneurs from minority groups
Various training sessions
Various promotional activities within communities (local festivals, markets, etc.)
Volunteership
As a complement to the banking component of BNP Paribas microfinance activity, the
Group mobilizes its volunteers (retired/active) by launching a double-approach initiative:
-International Approach : Microfinance Sans Frontières (MFSF)
Volunteers’ mobilization to bring their professional skills to MFIs in emerging
countries
-National Approach : via microStart Support (microStart)
Volunteers’ mobilization to support microStart’s micro-entrepreneurs
Growing demand for social commitment from employees: at BNPP Fortis, more
than 130 employees have spontaneously expressed their interest to participate
in the program of MFSF and microStart Support
17
Volunteership’ achievements
MFSF (Belgium, France, UK, USA, …):
100 missions implemented since 2008
30 countries : France, Syria, Niger, Madagascar, Mali, Burkina Faso, Bénin, Togo, Burundi, Argentina, Cambodia, Ecuador…
450 volunteers declared available
microStart Support (Belgium):
96 active volunteers (64 at Bxl, 19 at Gent and 13 at Luik)
1/3 are BNP Paribas Fortis Employees
Mainly Coaching
Investment in Equity, and in Debt
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Plus de détails en annexes
Incofin- Rural Impulse II
Rural Impulse Fund II financing and Investing in RIFII managed by IncoFin
Incofin will then invest 45% in the Equity part of some selected MFI and 55% in loans to other selected MFI
Our investment (30/09/2013):
• 2.5 Mio € in the equity part of the fund
• 2.5 Mio € in the senior loan part of the fund.
Marion Cahen
Manager, Microstart Gent
About us
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A group of Social Entreprises
microStart SCRL-FS
• Cooperative company
• Social Purpose
• Capital: 3,2 M EUR
• 12 employees
microStart support asbl
• Non For Profit
• Subsidized
• Budget: 250 K EUR
• 5 employees & 80 volunteers
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Network of 6 branches
23
Products & Services
Business Loans
• 100-10.000 EUR
• 36 Installments max.
• Fees: 5% flat
• Interest Rate: 8,25%-9,75%
• Individual-Group Lending
• Investment-Treasury
Business Development Services
• Idea Development
• Expert Meetings
• Group Trainings
• Individual Coaching
• Free of Charge
• Provided by Volunteers
24
Our Clients
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Selfemployed
30%
Jobseeker 29%
Employee 18%
Social Welfare
15%
Not Active 8%
Profesionnal occupation before microloan
Below Poverty Line
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80%
Factsheet
Outstanding amount: 2 Million EUR
Average loan: 4,800 EUR
PAR 90: 10%
Transformation Rate: 25%
BDS: 35% of the portfolio
27
Disbursments (Since March 2011)
0
100
200
300
400
500
600
700
Loans disbursed (Cumulative)
28
New Jobs (since March 2011)
29
400
Regulatory Framework
Immediate loss of Social Income
High Amount of Social Contributions
University Degree to get your VAT Number
If not, exam organized by the Fed. Min.
30
Business Model
31
Cooperative - % Revenues
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
2017
2013
2011
Financial Revenues
Subsidies
Capital
32
NGO - % Revenues
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
2017
2013
2011
Public Subsidies
Private Donations
Own Revenues
33
Loans/year break-even
34
2500
Break-Even in 2015
35
20%
3.000.000 € Equity needed until 2018
36
650.000 € Subsidies needed until 2018
37
How Much ?
Annual Direct & Indirect Costs of a
unemployed person
Source: Study 2012 of the European
Federation of Services
Annual Costs of BDS Services and
Extra Costs to access Financial
Services (per Client)
38
30,000 € 3,000 €
Main Issues
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Stay focused on the poorest
Innovate in new services that fit the needs
(microinsurance…)
Keep a reasonable amount of loan
Word of Mouth
40
Improve our performances
Processes
Management & Information System
New Technologies
Improve our Portfolio at Risk
41
Provide nice services at a fair price
Adapt the European Code of Good Conduct
Keep a reasonable amount of fees/interest
Let our clients be commited in the designing
of our products
42
Spend less time in Fundraising
More accessible funds
Procedures fit the size !
Start-Up Grants, loans & equity for FS
No more than 3 or 4 donors for BDS
43
The right question is not whether
the Interest Rate is high or not, but
probably who will pay the difference
between a fair price and a break-
even price
44
Thank you for your attention
45
v
i
s www.microStart.be
Philippe Duhamel
Head of credits of Hefboom - Impulskrediet
Philippe Duhamel
6 November, 2013
Agenda
Mission
Strategy
Microfinance at Hefboom: IMPULSKREDIET
Conclusions
Mission statement “Hefboom strives for a social and durable society & wants to support
this goal in close collaboration with companies, organizations and
persons”
Hefboom provides ethical investments, consulting services and
financing solutions towards social and durable initiatives. We want
to create an added value for vulnerable organizations with limited
financial capacity, who have need for additional management
consulting support and want to launch new innovative projects and
commercial activities.
All this is only possible through the shareholders community who
provide the necessary capital on the long term.
Strategy Focussing on the social profit sector in Flanders & the Capital region
Brussels the target group has been defined around the following
pillars:
– organizations in relationship towards the social integration economy
like social workplaces, protected workplaces, centers for education,...
– organizations in relationship with vulnerable groups like children,
youngsters in difficult educational situations, persons with
handicaps,...
– Social organizations or companies, co-operations, people and
environmental companies
– Innovative projects or activities related to the social economy
Microfinance at Hefboom: IMPULSKREDIET
Target group
Offering
Partners
Guidance
Marketing
Results
Analytical view on customers
Lessons learned
Target Group
Entrepreneurs or startups who do not have access to adequate bank
credit because of:
- Insufficient collateral or capital insertion
- history of their credits (filed at NBB)
- insufficient income (unemployed, depending on life wage,...)
- professional history (bankruptcy)
- Necessity of commercial & administrative skill
Our target group goes towards trustable & experienced entrepreneurs with activities who need not a lot of capital (rather services) that are well prepared (business plan available, eventually some clients) and with limited private costs or expenses
Our Partners
Flemish Government
NV Waarborgbeheer (public guarantee fund, Ltd)
Agentschap Ondernemen (public agency Entrepreneurship)
Collaboration with banking industry: operational support, funding,
consulting services, introducers,....like Belfius, Febelfin,...
Patronage
European Microfinance Network
Introducers of candidates:
Agentschap Ondernemen, Unizo, Activiteiten Coöperaties, Steunpunten
Participatiefonds, NFTE, Accanto, KUM, …
Offering
For easy to use, transparency, clear communication and comprehensive offer
our proposal is articulated around 4 different products:
GO “Existing entrepreneur or starter becoming independent as
main activity”
PART “Entrepreneurs starting as additional job”
COOP “Starting through activity co-operative”
START “Jobseekers wanting to start their own business in close
collaboration with “participatie fonds”
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How to proceed?
1. You fill up a contact-form from the site (www.impulskrediet.be ),
2. We check if you, your activity our your investment can be
considered for an Impulskrediet. (no access to bank credit,
independent activity , micro-enterprise, …)
3. We send an application form. You send it back, filled up with the
needed additional documents. (for instance certificates , contracts,
licenses….).
4. If it seems acceptable you are invited.
5. We gather the needed information and figures to estimate the
application.
6. Based on the business plan and the information, we make a file.
If good enough we introduce it on our credit committee.
7. The credit committee takes a decision on the amount and on the
conditions taking the human factor into consideration.
8. If the loan is accredited, we indicate a coach and we make up a
contract.
9. If all conditions fulfilled the Impulskrediet is paid, based on
evidences.
10. During 2 years coaching free of charge by one of our coaches.
He gives practical support, stays in contact and gives advice.
Results 2012 – The start of Impulskrediet is a success
Coaching
team of volunteers
2 years
Obligatory
Free of charge
On the floor
Always available, flexible
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Conclusions
– We have seen a definite social impact for the borrower
– The combination of Credits and Consultancy has a positive effect on
the relationship with the customer and the quality of the file
– Related to the financial risk, micro finance has not yet demonstrated
its positive business case. External funding funding is necessary to
get in the money
– Future development based upon controlled growth and differentiation
through product offering
Q&A
Finance Alumni, Your Financial Network
Thank you
Finance Alumni, Your Financial Network
Networking Drink
Finance Alumni, Your Financial Network