MENA Facility: a set of guarantees and credit lines for SMES in the Mediterranean

The EUR 23.2m MENA Facility makes it possible to set up guarantees adapted to the risks associated with SME finance, in particular in sectors with a high development impact, and absorb part of the additional cost generated by hedging mechanisms implemented to deploy credit lines in local currency.

This facility targets private financial institutions, via PROPARCO, and public institutions, via AFD, with the objective of easing the constraints, especially financial constraints, which are inherent to SME finance.

EUR 2m of resources for technical assistance are also available to build the capacities of the financial institutions to be targeted and serve SMEs, while strengthening the capacities of SMEs to access financing.

Finally, a strong ambition of the MENA Facility is to target high-impact players and sectors, which are faced with difficulties in accessing formal credit, such as women entrepreneurs, start-ups and the renewable energies and agriculture sectors. For example, this objective is achieved through an incentive mechanism, in the form of an “impact premium”, which encourages financial institutions to position themselves more in these segments.