ACTB: Calling out to sustainable businesses in Sierra Leone
“People want to know my secret. I am a single parent of three kids, and I could afford to send them to private schools. I feel strong and independent because A Call to Business (ACTB) believed in my bar/shop’s success. My first loan with ACTB was around 230 euros, and now I have access to a five times larger amount. Nowhere else was I able to get that kind of money. That’s how I know ACTB is there to support female entrepreneurs like me. Even during Ebola and COVID-19 outbreaks, ACTB gave me immediate relief funds to keep my shop afloat,” says ACTB borrower Simbiatu Conteh.
ACTB lends money to ambitious entrepreneurs and does the vital job of supporting the rising private sector in Sierra Leone. With a EUR 1.2M investment to ACTB, Cordaid Investment Management creates more employment opportunities for youth and women by supporting micro-enterprises, crucial for job creation in Sierra Leone.
The population of Sierra Leone is primarily rural and young: the median age in the country is only 18.5 years and 57% of people live in the rural areas. Nevertheless, unemployment among youth is extremely high. Financial uncertainty drives young people to engage in small-scale trade, cook for sale or open a repair shop. Rarely do they have enough savings or sufficient financial support from their families to fund the new business. Many turn to financial service providers for loans, however, accessing these services is not easy for the Sierra Leonians. For instance, only 20% of the population has an account with a formal financial institution. Even fewer are eligible for a bank loan. Lack of finance and business training make youth business ventures risky.
Supporting young entrepreneurs through access to affordable finance significantly boosts the country’s social and economic development. The country desperately needs young entrepreneurs to bring in new energy and restore the economy after a 4% GDP decline and 17% food inflation following the COVID-19 pandemic. Helping micro and small entrepreneurs realize their business ambition has been the mission of our partner, ACTB.
“ACTB has been CIM’s partner since 2018 and one of the MFIs with a strong commitment to promoting inclusive financial services in Sierra Leone. ACTB is aligned to CIM’s investment goals as it offers a diverse range of financial products, particularly reaching more female clients and communities often underserved by mainstream service providers,” says Archibald Shodeke, Investment Manager in Sierra Leone.
Since the start of Sierra Leonian operations in 2008, ACTB’s mission has been poverty alleviation by strengthening the private sector. Today, ACTB is one of the largest regulated microfinance providers in Sierra Leone, with ten branches located throughout Sierra Leone, 20,257 active borrowers, and 5,308 voluntary savers. Seventy percent of their clients are women, and 24% live in rural areas, showing the MFI’s commitment to serving the most vulnerable communities.
Marketing Coordinator of ACTB, Rockslyn Findlay, explains why supporting women in Sierra Leone is so important: “As one of the leading MFIs in Sierra Leone, we are targeting mostly female clients because women constitute a greater proportion of the poor population, and thus the provision of loans to women in rural areas leads to economic empowerment, improved well-being and social/political/legal empowerment for women. Traditionally, women have been disadvantaged in access to credit and other financial services. Commercial banks and other MFIs often focus on men and formal businesses, thus neglecting the women who make up a large and growing segment of the informal economy.”
Microfinance, SME Finance, and Microsavings are ACTB’s three business units. Savings mobilization is challenging in Sierra Leone given that it is still a primarily cash-based economy, but ACTB continues to gain the market’s trust. Rockslyn says ACTB will expand the financial offering onto the sustainable agriculture sector: “ACTB is currently exploring the Rural and Agricultural Finance program, which we piloted in early 2020 with 50 farmers. With this new program, we respond to farmers’ financial needs and reduce the high costs and risks of financial transactions in rural areas.”
Suffian Senesi needed a big loan and was able to find the finance he required for his pharmacy. “I became ACTB’s client just a year ago, but my loan amount has already grown by 1.5 times. First, I was able to get more popular products clients were requesting. Since I provided a better service, my customer base increased. The latest loan I took was over 11,000 euros. I used it to expand and diversify my business, adding a barbershop and a hairdressing salon. Now I have 20 people working for me, and they are doing an exceptional job. And at the end of the day, we all can put food on our tables. ACTB offered my employees and me a chance for better lives for their families. This microfinance institution has the right mindset to develop Sierra Leone. Not only do they offer finance, but business owners can talk to them and discuss their situation and opportunities. They listened to my ideas and offered valuable advice”.
Success stories like this would not have been possible without the support of impact investors, like Cordaid Investment Management. “Because of CIM’s loan, we were able to expand our portfolio, financed many of our clients, improved their living conditions, well-being, and social status. Moreover, CIM’s investment allowed us to launch COVID-19 awareness campaign,” concludes Rockslyn.
