Africa Microfinance Analysis and Benchmarking Report, 2008

This report analyzes the development of African microfinance in 2007, focusing on growth trends, national and regional regulatory environments, funding flows and structure, and MFI performance. It also provides information on the four subregions, namely, Central, East, Southern and West Africa.In 2007, sub-Saharan Africa experienced economic growth of 6.7%. It also attracted attention of the private sector, funders, domestic and international investors, and development agencies. Other positive trends included:

• Improvements in regulation, funding, growth and performance of the microfinance sector;
• Increased integration of microfinance into the formal financial systems;
• Substantial growth in borrowers, savers, loan portfolio and savings;
• Increase in total number of projects by 61%.

African MFIs are likely to see a decrease in external funding on account of the economic crisis. However, the effect may be mitigated as they are strong in deposit mobilization. Microfinance in Africa continues to face many challenges with low penetration rates and high operational costs. But with increasingly integrated financial systems, emphasis on savings mobilization and promising growth of start-up MFIs, Africa is striving towards increased outreach and sustainability.