Back Ground to FINES Project

The Financial Inclusion and Entrepreneurship Scaling (FInES) Project is the project of International Development Association (IDA) of the World Bank that aims to increase access to financial services and promote the entrepreneurship and capabilities of micro, small, and medium enterprises (MSMEs) in Malawi, including addressing the negative economic effects of COVID-19. 

The Government of Malawi obtained a loan amounting to US$86 million from the project through a Financing Agreement signed on 5 November 2020. 

The National Economic Empowerment Fund Limited   expressed interest to participate in the line of credit under   the project.

An approval of K10 billion facility was obtained and   following the approval, NEEF signed a subsidiary financing   agreement (SFA) with the Reserve Bank of Malawi where   the   Project Implementation Unit (PIU) is housed.

Objectives OF FInES Project

  1. Increase access to financial services.
  2. Promote entrepreneurship and capabilities of Micro, Small   and Medium Enterprises (MSMEs) in Malawi.

Qualification Criteria for Participating Financial Intermediaries

The facility requires participating financial institution (NEEF) to:

  1. Have an Environmental and Social Management System, which NEEF has developed and put in place.
  2. Have an established Monitoring and Evaluation system as the   loans under the project requires effective pre- and   post-disbursement monitoring.
  3. Have a Grievance Handling Mechanism.
  4. Establish appropriate Management Information System adequate to generate the required information for   performance monitoring, loan tracking and for timely   preparation and   submission of prescribed monitoring and   progress reports.

  5. The borrowers must be MSMEs that meet the credit   qualification requirements of NEEF or those that have been   certified to have undergone business development training by   NEEF

  6. Capital expenditure and working capital loans to MSMEs will be limited to a maximum of the equivalent of   USD70,000   per entrepreneur.

  7. All borrowers must be issued with an ID number, according to guidelines that are issued by the Lender (RBM) in order to   monitor progress reports.

  8. NEEF shall keep records of Sub-Loan Agreements financed with   the proceeds under the Credit Facility Agreement including a   copy of each Sub-Loan Agreement and all material documents   relating to the Sub-project financed for the duration of the   relevant Credit Facility Agreement.

  9. NEEF shall keep MSME sub-loans funded under MSMELCF separate and distinct from the rest of the credit portfolios.   The   portfolio will be reported to RBM on monthly   basis to   support   the monitoring and evaluation framework of the project.

  10. NEEF shall establish appropriate MIS adequate to generate the required information for performance monitoring, loan tracking   and for timely preparation and submission of prescribed   monitoring and progress reports.