Promotion of Access to Financial Services for Small and Medium Enterprises – National Financial Inclusion Survey and Strategy

Background:

Micro, small and medium enterprises (MSMEs) contribute significantly to the creation of new jobs in Egypt. Together with micro enterprises, they employ approximately 75% of the workforce, but only account for 25% of GDP. The difficult and unreliable access to finance for MSMEs constitutes one of many obstacles for their growth. According to the EBRD loans to SMEs account for only 6% of the total loan portfolio of Egyptian banks. Compared to other countries in the MENA region this is low. Additionally, the access to non-bank financial services, which are particularly relevant for the growth of MSMEs, such as leasing, factoring, insurance or equity, is negligible. The core problem thus is the inadequate supply of demand-based financial services for MSMEs. Therefore National Financial Inclusion Survey and Strategy will be conducted.

Objective:

The market diagnostic study for households and MSMEs, both on the supply and the demand side, in order to establish a baseline for financial inclusion in Egypt as well as establishing a baseline for gender by determining levels of financial demand, access, usage and quality of formal and informal financial services.

Results:

1. The nationally representative supply and demand side study for households and micro, small and medium-sized enterprises (MSMEs), which will gather comprehensive information on the demand, access, usage and quality of financial services across key product categories of payments/transfer services, savings, credit, and insurance for households and MSMEs.

       2. Development of a gender sensitive National Financial Inclusion Framework.