The activities of the majority of the population in African countries in the financial sector are not monetized, that is, these activities can be carried out without recourse to money. By definition, the poor have very little money. But it often happens that in their lives they need money or what money can buy.
A synthesis of 28 studies on the interest rates of informal loans in 14 countries in Asia, Latin America and Africa concludes that 76% of the interest rates charged by local lenders are higher than 10% Month, and among these, 22% exceed 100% per month. These lenders generally practice for the poorest
Than for the poorest. While these lenders are often stigmatized and treated as loan sharks, their services are accessible, quick and very flexible when borrowers face problems. The hopes of eliminating them from the circuit proved to be unrealistic even in contexts where microfinance institutions were very active.
ALG provides various services to microfinance institutions and to public and private partners involved in this field. Among these:
IMF project feasibility study
Identification of suitable financial products
Establishment of risk management mechanisms
Insurance system for microfinance services
Training of MFI staff.