OXUS opens in the Democratic Republic of the Congo
The OXUS Group was created by ACTED in 2005 with the aim to fight poverty through the provision of microfinance services to the working poor. Based on its experience in Afghanistan, Tajikistan and Kyrgyzstan, OXUS is opening a new branch in the Democratic Republic of the Congo (DRC) in September. Created by ACTED in 2005, OXUS has the vocation of fighting poverty by granting the poorest with access to financial services through microfinance activities. We discuss this opening with OXUS Manager of Operations Xavier Desmoulins and OXUS DRC Finance Director Charlotte Billoir.
Why did you choose to open in DRC?
Xavier Desmoulins: Originally, ACTED was running a microfinance project in the Eastern part of the country. OXUS wished to go with the momentum. DRC is one of the countries chosen by OXUS because of a complicated context, but also because the microfinance sector is not very strong. In capital city Kinshasa, there are many microfinance institutions, but as soon as you set a foot outside the city, the offer is much smaller. Moreover, opening in DRC is an opportunity for OXUS to change continents, because OXUS is mainly in Asia. This opening enables us to build a way of working that can be applied in the future to many other countries. It will also help increase access to financial services, such as microcredit or savings, for populations who can and wish to develop and income generating activity, beyond livelihoods, but who generally cannot be granted traditional banking services.
Charlotte Billoir: This is also a pilot mission to prepare for more OXUS openings in francophone Africa.
What are the different stages in setting up an OXUS branch in DRC?
CB: Opening an OXUS branch is a bit like opening a new ACTED mission. First, you have to be informed of the country laws, and send an administrative application in DRC and France. The next step is market research, in which you identify the different regulatory and legal conditions, which gives you an idea where to establish the branch and offer services. Once the location is identified, you have to set up offices and wait for certification from the Congolese central bank to begin projects. In our case, we were certified in May and the projects are to begin in September.
XD: The first OXUS team arrived back in January. They recruited people to make the market research, and concluded that we could settle in the Bandalungwa area. It’s a rather central neighborhood, with many commodities and few microfinance institutions.
What challenges did you come across?
CB: One of the most difficult steps for us was to find an office in the Bandalungwa area. We needed something available, large and well located. Location is a prime issue because it needs to be accessible to all, whereas it can be difficult to meet all those conditions. Moreover, though much effort went into this, microfinance is in a transition period in DRC; there are many things to consider before opening a branch.
XD: That’s right; opening an OXUS branch depends on conditions established by the OXUS group, to which you have to adapt. For instance, you need to build counters, offices and a safe, which require a lot of logistics and funding.
" Our objective within 5 years is to open some 15 branches and to reach 20,000 people. "
What is the future for OXUS in DRC?
XD: Our objective within five years is to open some 15 branches and to reach 20,000 people. The first activities will consist of credit and savings. We will also try to deploy in the whole country, particularly in the East, where ACTED currently intervenes. The fact that ACTED is present in the country is an advantage for us, because ACTED teams know the context and field work, and they can help us deploy and offer services adapted to the country’s development.
The finance sector in DRC: 1.4 million open accounts for 70 million people. In late 2011, 143 savings and credit cooperatives, 19 microfinance institutions, and 5 commercial banks were targeting the micro, small and medium-sized business sector throughout the country, but 78% of these operators are based in Kinshasa, North Kivu and South Kivu.
More information about OXUS in DRC
After having received the approval of the Central Bank of Congo in May 2012, OXUS DR Congo will start its activity in September, 2012. OXUS DR Congo is a “Greenfield” microfinance institution financed by OXUS Holding, Proparco, Incofin and I&P. This project is also supported by the grants provided by the French Agency of the Development (FAD) and the European Union through the ACP / EU Microfinance program. OXUS’ activities in DR Congo fall within the group strategy to spread its activities in Africa but also represent a straight continuation of the historic presence of ACTED in the South Kivu, the North-Kivu, Maniema, Equateur and Province Orientale.
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