€10 m loan to Morocco’s Fondation Arrawaj to support women-led MSMEs

13 / 12 / 2023

By Marwa Nassar - -

The European Bank for Reconstruction and Development (EBRD) and the European Union (EU) are joining forces to provide a senior unsecured loan of up to MAD 110 million (€10 million) to Morocco’s Fondation Arrawaj de la Finance Inclusive to support women-led micro, small and medium-sized enterprises (MSMEs).

Under the EBRD’s Women in Business programme to support women-led MSMEs, the EBRD funds will also provide extended support for women-led MSMEs located in the regions affected by the September 2023 earthquake.

The facility will be bolstered by a technical cooperation package funded by the EU. It will help deliver capacity-building and advisory services to women-led MSMEs to support their know-how and entrepreneurial skills development.

The investment is also supported by the European Fund for Sustainable Development Plus (EFSD+). Through its financial inclusion program, the EFSD+ introduces new, innovative financial instruments to the southern and eastern Mediterranean region (Egypt, Jordan, Lebanon, Morocco, Tunisia and the West Bank and Gaza) and eastern Europe and the Caucasus (Armenia, Azerbaijan, Georgia, Moldova and Ukraine).

As part of the EBRD’s response to the Al Haouz earthquake, Fondation Arrawaj will also benefit from the Bank’s financial support, with a specific focus on women-led MSMEs in the affected regions. This is one of the first transactions under the Bank’s initial response package of up to €250 million for 2023 to 2025, announced in October 2023, to rebuild Morocco’s economy in the earthquake-hit regions.

It will allow the Bank to provide a quick response to the aftermath of the earthquake while remaining fully in line with its main objective to promote women’s entrepreneurship in Morocco, as women are among the populations most affected by the event.

Since it began operating in Morocco, the EBRD has been supporting women-led MSMEs, which remain an under-served segment. Only a limited share of women-owned and -led firms have access to banking loans. This facility will foster the economic inclusion of women, which remains low: only 21 percent of women in Morocco participate in the labour force and only around 13 per cent of the country’s businesses are owned or led by women. This investment is the EBRD’s second partnership with Fondation Arrawaj. It will help Fondation Arrawaj improve its current business model and enhance practices to better engage with women-led MSMEs and meet their financial needs.