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By the end of the second quarter of 2020: Microfinance portfolio reached about 17.2 billion EGP benefiting 3.1 million from the most needy groups - Wednesday 2/9/2020
Dr. Omran: Board of Trustees of Microfinance Unit sets the rules for NGOs and civil associations to practice microfinance activities

The Board of Trustees of Microfinance Unit holds a meeting with NGOs and civil associations -after its re-formation - headed by Dr. Mohammed Omran  - FRA's Chairman to review the most important amendments to the law regulating  financing of medium, small and micro enterprises after  the approval of the Egyptian Parliament on them - late last August - in preparation for the promulgation of the law by the President of the Republic.

FRA's Chairman  explains  that these amendments will add new terms of reference for  Micro-finance  Unit  starting with setting conditions for obtaining a license to engage in  financing of medium and small enterprises. 

Besides , setting the rules and standards necessary for  NGOs and civil associations to engage in financing of medium and small enterprises  and managing the risks associated with it.

Dr. Omran revealed that the meeting witnessed a review of microfinance  indicators  at the end of the second quarter of this year, as the number of beneficiaries from the activity reached about 3.1 million with financing portfolio  of more than 17.2 billion EGP by the end of the second quarter of 2020. Meanwhile , by the end of the same quarter of 2019 ,  the number of  beneficiaries was 2.9 million with  financing portfolio  of  13.8 billion EGP . In this respect, indicators have shown stability in microfinance activity despite the economic effects arising from the emerging corona virus pandemic. Also,  the indicators of the second quarter of this year compared to the same period in 2019 recorded a rate of change in the number of beneficiaries of 5.8% and  a growth in financing portfolio  with a change rate of 24.9%.

FRA 's Chairman  added that the statistics prepared by  Microfinance  Unit showed that microfinance companies maintained their leadership in the market shares of the activity, as they had seized a market share of 53.96% of  microfinance  portfolios compared to a market share of 50.49% at the end of the second quarter of 2019 . On the other hand , the market share of  NGOs and institutions ( class A) declined to 39.24% at the end of the second quarter of 2020 instead of  41.51% at the end of the second quarter of 2019. And at a lesser pace, the market share of associations and institutions  (Class B)  decline to 3% at the end of the second quarter of 2020 after it had acquired a market share of 4.83% at the end of the same period of 2019.

In contrast, the market share of  NGOs and institutions ( class C) has grown, bringing its market share to 3.8% at the end of the second quarter of 2020 compared to a market share of 3.17% at the end of the second quarter of 2019.

Moreover, the statistics  confirmed the continued outperformance of females  in microfinance activity to record 63.7% of the total beneficiaries whereas males rate  reached 36.3% by the end of the second quarter of the current year 2020. On the other hand , by  the end of the second quarter of 2019 females  percentage reached  65% and  males percentage  was 34.2%.

In addition, the  Unit's Board of Trustees is concerned with studying ways to develop microfinance activity, following up on the unit’s performance , setting conditions for obtaining a license to practice microfinance activity. That is besides  approving the necessary rules and standards to practice the activity, approving inspection  and oversight  rules and referring them to FRA's BOD to consider its  issuance.

Previously, the Authority’s Board of Directors issued decision  No. 155 of 2019 to form the Board of Trustees of  Microfinance Unit,  it included  May Abul Naga, a representative of  Central Bank of Egypt , Mohammed Saeed Mustafa, representative of the Ministry of Social Solidarity, Nevin Ali Badr Al-Din,  representative of the  Egyptian Micro, Small and Medium Enterprises Development Agency (MSMEDA). In addition to , Medhat Ayad Khalil and Hala Fawzi Abu Al-Saad - two leaders of NGOs and civil institutions operating in microfinance , Hassan Farid, an expert and  finally three representatives  from  the Authority  nominated by its Chairman .