Guidelines

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Funding Phases

The MCBF will provide awards through three separate Calls for Proposals (CfP), occurring annually over the course of 2011 – 2013. Each call with focus on a specific area(s) of intervention and a specific set(s) of African countries. The 1st CfP will open in July 2011, the 2nd CfP in October 2012, and the 3rd CfP in October 2013.

Scope of Technical Assistance

The MCBF will offer technical assistance at the following three levels:

  • Retail Institutions Capacity (Micro Level): The aim is to create, broaden and deepen a diversified supply side of financial services to the poor through capacity building and institutional strengthening. Activities at this level could include training programs, capacity building/consultancy, and knowledge sharing events.
  • Market Infrastructure (Meso Level): The aim is to promote the strengthening of the market infrastructure so that MFIs can rely upon high quality and sustainable services. This involves the provision of capacity building and institutional strengthening to meso-level actors, and subsidizing MFIs to access their services.
  • Legal, Regulatory Framework, and Supervision (Macro Level): The aim is to enable environments to foster sustainable growth of the retail financial institutions.

 

Financing Activities

Applicants are invited to propose projects in the following areas of intervention:

Intervention Area #1: Increase Transparency within the Microfinance Sector

Acknowledging that a lack of transparency in the microfinance industry is a key barrier for an MFI to raise capital, gain confidence from clients, and therefore grow, expand, and deepen outreach, this area will address capacity-building needs at the retail, market infrastructure, and regulatory levels.

Within this area of intervention, the Fund will specifically focus on the following sub-themes:

Area 1.a: Governance (micro level): Improve transparency at the level of the MFIs governance

Area 1.b: External Audit (micro level and market infrastructure): Train auditors to work with financial intermediaries in the microfinance sector; support MFIs in getting appropriate external audit services; support the design of business models that allow for services to be provided at a cost MFIs can afford

Area 1.c: Accounting and Financial Reporting (micro level and market infrastructure): Train MFIs’ accountants as well as external accountants to implement accounting standards, reporting and financial analysis as per local regulation as well as microfinance best practices

Area 1.d: Supervision (policy level): Support capacity building for supervisory bodies

Intervention Area #2: Deepen Outreach to Rural Areas

While studies have shown that poor and low income communities have a demand for a variety of financial services, there are a limited number of products geared toward and accessible to these populations, particularly those in rural areas This intervention area will support innovation in both product development and delivery to insure increased access to high quality financial products for both rural and urban populations.

This may include agri-value chain financing, branchless banking to reach out to rural areas while controlling costs, crop/weather insurance, diversification of the credit product range (leasing, warehouse receipt systems).

Geographic Areas

The MCBF will provide technical assistance in various areas of Africa. It will support national project as well as multi-country projects in the following regions:

  • West African Economic Monetary Union (WAEMU):Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal and TogoOther countries within the ECOWAS region could be considered on a case by case basis, i.e., apart from WAEMU: Cape Verde, Gambia, Ghana, Guinea, Liberia, Nigeria, and Sierra Leone
  • Economic and Monetary Union of Central Africa (CEMAC): Cameroon, Central African Republic, Chad, Equatorial Guinea, Gabon, and Republic of Congo
  • Southern African Development Community (SADC): Angola, Botswana, DR Congo, Lesotho, Malawi, Mauritius, Mozambique, Namibia, the Seychelles, South Africa, Swaziland, Tanzania, Zambia, and Zimbabwe

 

When to Apply: Schedule for Applicants

As noted above, each CfP will focus on particular sets of countries and areas of intervention. Please apply during the relevant CfP:

Call for Proposal Region Area of Intervention
CfP #1 (2011) WAEMU #1: Increase Transparency within the Microfinance Sector
CfP #2 (2012) CEMAC #1: Increase Transparency within the Microfinance Sector
WAEMU #2: Deepen Outreach to Rural Areas
CfP #3 (2013) SADC #1: Increase Transparency within the Microfinance Sector
CEMAC #2: Deepen Outreach to Rural Areas

 

Eligibility Criteria

Applicants eligible to receive grants from MCBF include, but are not restricted to:

  • Service providers to retail financial institutions – includes training centers, credit bureaus, audit firms, rating companies, and IT firms
  • Networks of retail financial institutions
  • Groups of retail financial institutions
  • Retail financial institutions servicing poor and low-income clients, with special attention to women and rural areas. Please note that Group or Network applications are preferred over individual applications.
  • Government entities and central banks*

In order to be eligible for a grant, each applicant must:

  • Be an entity legally constituted and registered in Africa
  • Demonstrate sufficient expertise to manage the proposed project
  • Provide a minimum of 3 years of audited financial statements
  • Be or be close to sustainability, i.e. be able to cover operational costs with revenues
  • Have the capacity to enter into financial and legal agreements with the AfDB
  • Be directly responsible for the preparation and management of the proposed project, i.e. not acting as the intermediary
  • Prove to have long term commitment to microfinance
  • Provide a minimum contribution of 20% of the cost of the project. Although the emphasis will be on monetary contributions, cost sharing is possible in various forms and may include in-kind contributions, such as providing office space, staff labor, transportation or accommodation
  • In addition, retail financial service providers need to have assets above Euros 300,000 and a minimum of 3,000 active microfinance clients in case they apply individually or as lead applicant

*Government entities and central banks are not required to apply through the Call for Proposal (CfP) process and may submit a request at any time to the MCBF. Please contact: Jeanne Nzeyimana, Human Development Department, j.nzeyimana@afdb.org and Rafael Jabba, Financial Intermediation and Microfinance, Private Sector Department, r.jabba@afdb.org.

Evaluation Criteria

Projects will be evaluated on the following factors:

  • Relevance: to country and microfinance sector needs, intervention areas of the Fund and Fund priorities
  • Effectiveness and feasibility: to implement proposed activities
  • Efficiency: in its cost/benefit analysis, ability to match cost sharing criteria and comply with Fund’s disbursement conditions/timeframe
  • Sustainability: of applicant’s long term commitment to supporting financial services with a focus on women, and the scalability of the project
  • Impact: on microfinance outreach, women’s access to finance, and microfinance sustainability; monitor and evaluation framework and applicant’s ability to report

 

Funding Parameters

  • Average Award Range: €200,000 – €500,000 per project, though projects that require less or greater support will be considered
  • Project Duration: 1 – 2 years: 2 year maximum
  • Number of Awards Granted: 5-7 awards per CfP

 

General Conditions

  • Applications are limited to one per applicant institution.
  • Funding Guidelines:MCBF is able to fund: Technical assistance, Training costs, Purchases of equipment/hardware/software within the limit of 15% of the requested amount, and Operational costs related to project implementation needs.
  • Procurement: Beneficiaries must comply with AfDB’s rules on procurement of Goods and Works and Consultants.

 

Timeline

  • July 19, 2011: First Call for Proposals opens
  • September 19, 2011: Deadline to submit proposals for first phase
  • October 2011: Grantees notified
  • January 2013: Funds disbursed
  • October   2012: Launch of second Call for Proposals – Apply
  • October 2013: Launch of third Call for Proposals

 

Apply

If you are interested in submitting a project proposal, please learn more about how to apply.