OUR THEMATIC ISSUES AND PRIORITIES

A sustainable world needs sustainable finance. We are helping to build a better and sustainable African SME finance ecosystem – one that is stronger, inclusive, fairer and more sustainable. ASFIN works with partners and other stakeholders to promote access to finance. It shares insights on the changing realities faced by SMEs, discusses the implications for investors, and provides some practical tools that can be deployed by investors and financial institutions (FIs) to meet the growing demand for finance. In addition to accelerating lenders’ decisioning speeds, these new capabilities may help lenders more quickly calibrate their models, reduce their application processing costs, and broaden the range of SMEs they serve.

SME owners struggle to make the investments they need to increase productivity and competitiveness of their business, develop new markets, and hire more people. According to The Voice of the SME, 66% of SMEs want to receive faster access to credit when needed—often within a week or less.  In recent years, lenders have responded to this demand, with many now offering instant credit decisions and same-day disbursements. These new offerings are made possible by the availability of a strong data ecosystem that facilitates data exchange and analysis. Lenders can look beyond traditional financial and bank statements as a basis for credit decisioning toward new alternative data sources, such as accounting and e-commerce systems, payment gateways, agent banking, and others. 

Investors will more often make an investment in an entrepreneur they like with an idea they have some reservations about than an idea they like and an entrepreneur they think is a jerk. ASFIN works with entrepreneurs through the African SME Forum to develop on their entrepreneurial journeys. It provides mentoring support and online coaching such as planning stages, pitch deck and answering questions from angel investors. Angels often have tons of questions, and that's a good thing, it's a sign they are considering investing. ASFIN helps entrepreneurs to focus on the conversation and how their investments will move the business forward. By doing this, ASFIN hopes this will result into a vibrant entrepreneur ecosystem in Africa with more young people realising their potential as resources.

Lack of access to finance is consistently cited by SMEs, especially women-owned businesses, as one of the main barriers to growth. Often considered by commercial banks and financial institutions as risky and costly to serve, women-owned SMEs are largely underserved when it comes to basic financial services.

In particular, women outside the formal financial sector, who are the most vulnerable and the hardest to reach, become even more essential. ASFIN works with members, government officials and other regulatory agencies in African markets with the skills to identify, design and implement a policy initiatives to advance women’s financial inclusion, coupled with the skills to spur gender financing and create an enabling environment to advance women leaders within their institutions. 

Today there are more than 1,700 ESG-related guidelines and 600+ frameworks, including over 360 different accounting standards, some of which are mandatory and will become mandatory in the future. ASFIN is pioneering a performance benchmarking process to measure and analyze its members' performance of investment products, services, operations, and other business processes against other companies, competitors, or industry leaders in the African SME Finance ecosystem in other regions. The goal is to help members and non-members identify and understand areas for improvement  through monitoring their business activities’ performance. 

This process helps companies benchmark and measure several metrics, and customer retention. ASFIN's Performance benchmarking/Ratings provides insights into how other brands compare to one, even if their audience or industry differs.

It helps them track key performance indicators (KPIs) and strategise their operations to achieve business objectives. Performance benchmarking allows them to see how their business pans out against competitors or best-in-class industry standards.

Overall, performance benchmarking allows businesses to:

• Analyze past performance
• Compare their operations against industry standards
• Improve processes, products, and services to increase customer satisfaction, build loyalty, and promote retention

Climate change is leading to profound changes in the way businesses operate. For SMEs, these changes will accelerate as stakeholders, regulators and competitors respond to the global challenges of climate change. As well as the challenges of capturing and reporting climate-related financed emissions, the focus is now turning to biodiversity restoration reporting. National regulators and other regional policymakers are calling for the biodiversity impacts of organisations to be quantified and understood. This poses a huge challenge for investors in emerging markets like Africa in terms of collating this data and processing it in a meaningful way. ASFIN works with members, policymakers and partners on how investors, SMEs and financial services firms are approaching the challenges of investigating and disclosing their impact on the environment and on society. 

Recognising that small and medium enterprises (SMEs) play a critical role in the African economies and are also often very vulnerable to the impacts of climate shocks and stresses, building their resilience becomes paramount. Disasters in the region have highlighted the devastating impacts faced by the SMEs. Climate change is a major concern for small and medium-sized enterprises. As per Zurich Insurance Group’s (Zurich) fourth annual global SME survey conducted a year after the Paris Agreement, almost four-fifths (78%) of SMEs surveyed expected risks associated with climate change to have a significant effect on their business.