Ashraf El Kady, Chairman of The United Bank, said that the Bank, in partnership with the Sanad Foundation and Frankfurt Institute for Finance and Management, one of the largest German expertise houses are to provide technical support and consultancy necessary to increase the market share of The United Bank from the volume of funding granted to the SME's sector at the level of all governorates of the Republic.
El Kady explained that The United Bank strategy 2019-2020 was built on the basis of the gradual expansion and increases the market share of the bank in financing small, medium and micro enterprises in the Egyptian market. And provide specialized services to this sector, which is the cornerstone in achieving the goal of sustainable growth in Egypt in accordance with the vision of 2030.
"We are delighted to be able to share the opportunity of The United Bank to develop and strengthen microfinance activity in Egypt," said Dr. Daniela Beckman, Chairman of Sanad foundation. "Sanad's ultimate goal is to promote the success of microfinance and Employment in the Middle East with the aim of supporting small, medium and micro-enterprises which are one of the most important pillars of economic development in Egypt."
On the use of international institutions and houses of international experience, Ashraf El-Kady pointed out that Sanad Foundation and Frankfurt Institute for Finance and Management - one of the most important international expert houses located in Germany. They have been used to develop a general framework for Egyptian market policies, regulations and research, as well as the transfer of experiences of successful countries in this area, led by the experience of the State of India. As well as training cadres from the team and develop their abilities so that they can work in accordance with international best practices.
Where a number of sessions and workshops were held, and the current work systems were examined and new work procedures developed in line with the technological development and infrastructure of the Bank and adapted to serve the purposes of microfinance, as well as solutions to some problems, especially funding and the needs of this group of society.
Egypt is a young country
El Kady said Egypt was a young country. Egypt's youth population is 20.2 million in 2018, according to |The Central Agency for Mobilization and Statistics (CAPMAS). They represent about 21% of the total population of Egypt. Classified as 50.6 males and 49.4 females. 44.5% use computers, 84.5% use mobile phones, and 47% use the Internet. The percentage of unemployed with high qualifications is 38.3% and intermediate qualifications.
Therefore, we are in front of an explanatory statement to the youth power and its ability to work and development and achieve sustainable development and between factors that drive the political leadership and the central bank towards the development of small, medium and micro enterprises as a dark horse to achieve development and fight unemployment. As well as the positive effects of acceptance of this important category of technology uses particular financial technology of payments and succession.
Rapid Growth of Microfinance in Figures
Ashraf El Kady pointed out that the size of the microfinance portfolio recorded 15.6 billion pounds in 2018 compared to 7.5 billion pounds in 2017. Representing 2.9 million customers. Women acquires for 52% of total funding granted.
He added that the civil associations of donor funding came first. Followed by microfinance companies and the number now in Egypt 6 companies. Banks came in third place in terms of funding providers.
The reasons for the growth of the microfinance sector
El Kady attributed the reasons for the growth of the microfinance sector in this way to several factors, including state trends and support from the General Authority for Financial Supervision and the Microfinance Union to regulate the activity practices. As well as the initiative of The Central Bank of Egypt to provide the necessary facilities for associations, companies and individuals by banks to finance this important segment. As well as media campaigns in different media, raising awareness of the citizen, especially women and young people, the importance of self-employment and financial inclusion.
Financial Solutions Financial Technology is the Magic Solution
All these factors have contributed to the Bank's strategy to expand the financing of SMEs sector. As well as adapting the financial technology, this is characterized by The United Bank domestically and regionally in the service of its strategic objectives.
The citizen can fulfill all his obligations from installments and others and inquire and request the grant of funds through technological applications, including mobile banking and Internet banking and digital wallet. As well as many innovative financial solutions through the services of The United Bank through the Internet banking companies from the place without the need to go to the bank branch.
SMEs are one of the mechanisms for integrating the informal economy
Ashraf El Kady said that the process of integrating the informal economy into the formal system has become the issue of the state agenda and there are serious steps from the Egyptian government. Because it has a significant and effective effect in the treatment of many economic and social problems, including increased tax revenues and creates jobs and reduces imports and improves the quality of local product and reduces unemployment rates.
Economic Census of Egypt
In this regard, the State conducted the first electronic economic survey by The Central Agency for Mobilization and Statistics in the last quarter of last year and continues until the end of March. And the goal of knowing the size of the informal economy estimated at 40% and the status of the official system of the Egyptian state through the announcement of the law of tax treatment for small, medium and micro enterprises so that the state can subject them to the tax community.
As well as the initiative of The Central Bank of Egypt to provide easy financing for small and medium-sized enterprises and micro-financial inclusion and attract a larger segment of Egyptians to deal through financial institutions. As well as work to change the culture of financial transactions.
Innovation is a catalyst for the growth of SMEs sector
El Kady stressed that SMEs need more technical support and improved logistics networks, namely, the interest in the innovation component. Especially in the field of financial technology, which is a growing global activity to build an environment conducive to the encouragement of innovators in the next generation.
Encourage and embrace innovators through business incubators and the initiative of Nile pioneers
Ashraf El-Kady said that Egypt seeks to remove all restrictions on the growth of small, medium and small enterprises sector for expansion and export.
As well as the establishment of incubators for business in various Egyptian universities such as the initiative of the Nile pioneers in cooperation between a number of Egyptian banks, including our bank led by The Central Bank of Egypt and the Nile University.