Johannesburg, South Africa, February 12, 2014
—IFC, a member of the World Bank Group, together with the Consultative Group to Assist the Poor, CGAP, today released a research study that examines the successes and challenges of the greenfield microfinance business model as a tool for increasing financial inclusion in Sub-Saharan Africa.
Greenfield MFIs in Sub-Saharan Africa: A Business Model for Advancing Access to Finance
finds that after five years in operation, greenfield MFIs on the continent attain larger size, greater reach, higher loan quality and better profitability than MFIs with no strong holding or network affiliation.
Greenfield microfinance institutions are newly created local institutions set up by a regional or international network or holding company that backstops operations, provides standard policies and procedures, and co-brands the subsidiaries in the network. The model can be considered a type of franchise and has been employed in the region since 2000, with more than 30 greenfield MFIs now spread over 12 countries. Local examples include AccessBank in Liberia and Advans Banque in the Democratic Republic of Congo.
Julie Earne, IFC microfinance specialist and co-author of the research paper, said, “African greenfield MFIs now have a sufficient track record for us to fully review their performance and role in the market. This is valuable information for future investment in microfinance and for the global effort to increase access to affordable financial services for low-income individuals and small-scale entrepreneurs.”
The study found that greenfield MFIs have had positive effects on responsible market development in several countries, and on innovation and product development. These institutions often make a significant contribution to the professional development of staff in the local banking and microfinance sectors, creating paths for long-term careers in the broader financial industry.
One challenge shared by most of the holding companies behind the greenfield MFIs was the relatively high cost of doing business in Sub-Saharan Africa compared to other parts of the world.
The study was authored by experts from IFC and CGAP, and funded by the Partnership for Financial Inclusion, a joint initiative between IFC and The MasterCard Foundation that aims to increase the scale of sustainable microfinance and develop mobile financial services in Sub-Saharan Africa. An important part of the Partnership is to advance and share research from the program with the industry and general public.
About the Partnership for Financial Inclusion
In January 2012 IFC and The MasterCard Foundation launched the $37.4 million Partnership for Financial Inclusion to bring financial services to an estimated 5.3 million previously unbanked people in Sub-Saharan Africa in five years. The program aims to develop sustainable microfinance business models that can deliver large-scale low-cost banking services, and provides technical assistance to mobile network operators, banks and payments systems providers in order to accelerate the development of low-cost mobile financial services. To find out more, please visit
CGAP (the Consultative Group to Assist the Poor) is a global partnership of 34 leading organizations that seek to advance financial inclusion. CGAP develops innovative solutions through practical research and active engagement with financial service providers, policy makers, and funders to enable approaches at scale. Housed at the World Bank, CGAP combines a pragmatic approach to responsible market development with an evidence-based advocacy platform to increase access to the financial services the poor need to improve their lives. More at
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in more than 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and promote shared prosperity. In FY13, our investments climbed to an all-time high of nearly $25 billion, leveraging the power of the private sector to create jobs and tackle the world’s most pressing development challenges. For more information, visit