A French Position

This presentation describes the varied support that French Aid provides to the financial sector.

It states that French Aid aims to:

• Promote diversification, meet the complete range of an economy's needs and catalyze constructive interaction between the various components of the financial sector;
• Support new forms of financial intermediation, helping them achieve long-term sustainability;
• Create a favorable environment for the institutions operating in it by lending support at institutional, macroeconomic and social levels.

The presentation states that French Aid:

• Funds development by providing institutional support, support to the financial sector and finance for the private sector;
• Passed through various stages in its association with microfinance, namely:
  • Experimentation;
  • Focus on cost-effectiveness and sustainability;
  • Consolidation and professioanalization of microfinance institutions (MFIs).
• Serves sections of society that have no access to financial aid with short term financial facilities.

The presentation:

• Describes the impact of French Aid schemes that confirm the role of microfinance as an instrument of both economic and social development;
• Identifies the following channels that microfinance has to face:
  • Financial, social, and institutional viability;
  • Fitting into the financial sector and the economy as a whole.

The presentation concludes by presenting the current strategy of French Aid in the areas of:

• Project funding;
• Training of MFI staff and support to MFIs;
• Support to improvement of regulatory frameworks;
• Innovations in products and operating methods;
• Communication and capitalization.