Tunisia - Expansion of Rural and Agricultural Operations

The European Bank for Reconstruction and Development (the EBRD or the Bank) is currently considering provision of a senior loan for on-lending to micro and small enterprises (MSEs) to Enda Inter-Arabe (Enda IA, the Client), a microfinance institution (MFI) in Tunisia (the Project). Tunisia has entered a new stage in its development, in which questions relating to employment, regional development and financial exclusion are taking on renewed importance. Microfinance is recognised as an important tool for financial and social inclusion. The loan being considered by the Bank would, in particular, assist Enda IA extend its outreach to MSEs operating in rural areas. Enda IA is a microfinance non-governmental organisation (NGO) created in 1990 as a branch of Enda Third World, the Environment and Development Action agency based in Dakar, Senegal. Today, it is fully autonomous. Enda IA is the only commercially-operating (MFI) in Tunisia and best-practice provider of micro-credit. Initially dedicated to a wide range of activities in development and environment, it introduced micro-credit into its activities in 1995 and, since 2001, has specialised in supporting micro-entrepreneurs, mainly through micro-credit. It is expected that during the next 18-24 months Enda IA will create a joint stock company (societe anonyme). Today, Enda IA operates through 65 branches throughout Tunisia and has more than 200,000 clients in both rural and urban areas. It is committed to extensively increasing the outreach of its rural and agricultural lending operations with the objective of having 50% of its portfolio in rural areas by the end of 2015. Tasks Assess and improve current rural products and introduce new rural products: Review and analyse current offerings, MIS, costing and pricing and delivery channels. Advise on the implementation of and required mechanisms for the creation of a Guarantee Fund; Propose new rural and agricultural products; Propose an action plan to implement the new organisational structure, systems and processes in relation to the promotion of current and new products; Restructure and train the Rural Unit; Review and analyse Enda IA’s Rural Unit, its staffing, mode of operation and process mapping; Propose a staff training strategy; Provide train-the-trainer training and field coaching to 20 staff members in rural and agricultural lending. The staff will come from Enda’s Rural Unit, training unit and middle management (operational coordinators and supervisors); Provide train-the-trainer training and field coaching for 20 client advisors on non-financial services; Provide training on gender equality and how to promote it; Improve and adapt non-financial services for rural clients; Examine Enda IA’s current non-financial services for rural clients, how to improve and adapt them, and how to enhance the non-financial services department to be the nucleus of ENDA NGO after the creation of the future joint-stock company Randomised impact assessment of Enda IA’s rural and agri-lending   The EBRD and ENDA IA are exploring the option of undertaking a randomised impact assessment of Enda IA’s rural and agri-lending to analyse its social impact. If such a study goes ahead, it is required to work with the EBRD research team, including an outside academic consultant, on a successful implementation of this study. In particular it would be crucial to involve the research team in the design as well as the (further) roll-out plans of any new or existing agri-products in rural areas.