COMUBA MFI: protecting women and mitigating climate risks in rural Benin
A new cohort of Social Finance Fellows joined us recently. In this blog, Zika Djodjo, shares his first impressions on working with different microfinance institutions (MFIs) in Benin, Burkina Faso and Mali.
In July, I started my fellowship with the Cooperative des Membres Unis Bethel Action (COMUBA) in Benin. COMUBA is one of 111 approved MFIs in the Beninese market.
COMUBA is the result of an initiative of 10 people who, unable to obtain funding from the traditional financial sector for the development of their activities, decided to take the initiative to mobilize each 200,000 West African CFA francs (US$314) to make loans each in turn.
Early on, following the happy outcome of a member’s proposal to help a group of women and grant a loan of 430,000 francs (US$675), the members of COMUBA decided to finance other groups made up of women.
This is how COMUBA started from an initiative aimed at meeting the financing needs of individual members into a microfinance institution (MFI) oriented towards women. It was created in 2000 and obtained its accreditation in 2008. It has more than 45,000 members, more than 80 per cent of whom are women. It offers savings, credit, foreign exchange, money transfers, digitalization and training activities.
Agriculture financing has grown considerably in recent years, rising from 5 per cent of the portfolio three years ago to 30 per cent today, and it could reach 75 per cent in the years to come.
COMUBA mainly finances groups of small farmers and small production units in the field of cotton, corn, soy, poultry farming, palm oil processing, pineapple and nurseries. The share of agriculture is much greater if we include the financing of businesses that revolve around agricultural production such as fertilizers, food products and agricultural transport.
Unfortunately, the agricultural sector and related activities in Benin is exposed to climate change and climate risks such as drought, floods, rising sea levels and coastal erosion. These risks have a considerable impact on both actors (producers, their employees, their families) and goods (sources of repayment of loans contracted by COMUBA members). As such, financing of the agricultural sector exposes COMUBA to increasingly greater risks and it needs to protect itself to ensure sustainability of its activities.
COMUBA therefore has to identify risk management solutions to guarantee loan repayments, which providesthe protection to the borrowing members and their families, as well as protection for the MFI.
My fellowship with COMUBA, supported by Grameen Crédit Agricole Microfinance Foundation (GCAMF) and the ILO and funded by AFD/Proparco, is focused on improving the existing insurance offering and developing new ones to mitigate against climate risks. As a Fellow, my tasks range from understanding members’ needs (market studies), designing offers, procedures, risk management, training and launching pilots to scaling, change management and skill transfer.
The other MFIs of the Project
I will also support three other GCAMF partner MFIs: Pan-African Microfinance du BF in Burkina Faso (PMBF), Réseau de Micro-Institution de Croissance de Revenu in Mali (RMCR) and Vision Funds Senegal (VFS). I will help them improve their microinsurance offerings and launch new products. We are also planning experience sharing and distance training for four other partner MFIs: COOPEC SIFA and Assilassime Solidarité in Togo, KAFO Jiginew in Mali and ACFIME in Burkina Faso.
Through this programme, I have the opportunity to share my experiences and skills and help promote impact insurance and financial inclusion, but also to strengthen my own knowledge of inclusive insurance and positively impact the living conditions of low-income people.
I am very happy to be part of this programme. Stay tuned to learn more about the evolution of this great adventure, the challenges and the lessons learned.