Togo: Loans Granted by Microfinance Institutions Up 6.5% in Q4 2023, against Q3 2023

Finance

Wednesday, 08 May 2024 15:53

Togo: Loans Granted by Microfinance Institutions Up 6.5% in Q4 2023, against Q3 2023

(Togo First) - Recent data from the BCEAO reveals that the microfinance sector in West Africa, particularly in Togo, experienced growth by the end of December 2023, despite facing some headwinds.

Credit Portfolio Expansion

The outstanding loans granted by Decentralized Financial Systems (DFS) or microfinance institutions in Togo increased by 6.5% in the fourth quarter of 2023 (quarter-on-quarter), marking an absolute increase of 22.5 billion CFA francs. Togo recorded the third-largest increase during this period, behind Senegal (+6.6%) and Benin (+9.5%), and ahead of Burkina Faso (+21.4 billion CFA francs, +6.2%), Côte d'Ivoire (+16.1 billion CFA francs, +2.6%), and Guinea-Bissau (+525.0 million CFA francs, +1.1%). However, there was a decline in Niger (-1.2 billion CFA francs, -8.9%) and Mali (-478.8 million CFA francs, -0.2%).

At the UEMOA level, the outstanding loans increased by 125.3 billion CFA francs, with an average quarterly growth of 5.1%, reaching a total of 2,561.1 billion CFA francs.

Slight Increase in Deposits

On the deposit side, clients' deposits in microfinance institutions in Togo saw a slight increase of 0.5% (+1.8 billion CFA francs in absolute value). This modest growth contrasts with the overall decline in deposits collected by microfinance institutions across the Union. Deposits decreased by 8.8 billion CFA francs (-0.4%) compared to the previous quarter, totaling 2,263.8 billion CFA francs. This quarterly decline was observed particularly in Benin (-6.3%), Côte d'Ivoire (-0.9%), Burkina Faso (-1.2%), Mali (-1.6%), and Niger (-3.1%).

Moreover, as of December 2023, nine microfinance institutions were under provisional administration within the Union, including two in Togo.

Ayi Renaud Dossavi

REFORMS OVERVIEW

STARTING A BUSINESS (more info)

At the fifteenth position, worldwide, and first in Africa, under the Starting a Business index of the 2020 Doing Business ranking, Togo sustains its reformative dynamics with more reforms….

ENFORCING CONTRACTS (more info)

Compared to some years ago when it was one of the lowest rankers under the Doing Business’ Enforcing Contracts indicator, Togo, leveraging many efforts to improve its business climate, was able to jump significantly on the index in the recent years... .

CONTRACT EXECUTION (more info)

Creation of special chambers of commerce for small debts • Creation of chambers of commerce at the Court of Appeal • Civil and commercial cases now handled by distinct clerks • Establishment of commercial courts in Lomé and Kara • Lawyers and bailiffs now have access to the FORSETI COMMERCIAL platform • A maximum period of 100 days was fixed to settle a commercial dispute .

TRADING ACROSS BORDERS (more info)

In comparison to previous years,Togo has significantly improved its ranking under the“Trading across borders” indicator by adopting multiple reforms that focus mainly on the digitization and reduction in delays, for import and export procedures related to import and export.

In comparison to previous years, Togo has significantly improved its ranking on the “Trading across borders” index by adopting multiple reforms that focus mainly on the digitalization and reduction in delays, for import and export procedures related to import and export.

CONSTRUCTION PERMIT (more info)

After moving from the 133rd to 127th place under the 2020 Doing Business’ construction permit index, Togo intends to reiterate this feat in the coming edition of the global ranking. To this end, it has introduced this year multiple reforms.

GETTING ELECTRICITY (more info)

Over the past two years, Togo’s ranking under the Doing Business’ Getting electricity and water indicator has increased consistently. Owing this performance to multiple reforms aimed at making it easier for businesses to access power and water, Lomé plans to introduce even more reforms this year to keep up its improvements.

REGISTERING A PROPERTY (more info)

Out of all the 'Doing Business’ indicators, Property Registration is where Togo has improved the most since 2018. Indeed, after spending years in the lowest part of this ranking, the country now seeks to beat Rwanda which is the best performer on this index in Africa. To do so, Lomé has been introducing many reforms, with the latest batch implemented this year.

PUBLIC PROCUREMENT (more info)

From professionalization to digitization, through legislative regulations, Togo’s public procurement framework is constantly being modernized. Several reforms have been implemented to improve the sector much to the benefit of the private sector, which is the focus of the National Development Plan.

PAYING TAXES AND DUTIES (more info)

To improve its business environment, Togo introduced some important reforms related to the payment of tax and duties. From the replacement of some taxes to the cancellation of others through exemptions, the country has only one objective: offer the most attractive tax framework to investors and economic operators. To achieve this, the authorities relied on digitization.