The Sovereign Fund of Egypt (TSFE) and Etisalat Egypt by e& have partnered together to launch the new company Erada Microfinance with the goal of providing access to a wide range of financial services to micro and small enterprises. The partnership is in line with Egypt’s Vision 2030 of supporting financial inclusion and creating opportunities for the youth through providing innovative financial services and digitally-enabled lending products.
The founders and shareholding structure of Erada in addition to TSFE and Etisalat Egypt by e&, includes Mr. Amr Abouelazm, an industry veteran in the area of non-banking financial services who has also been appointed as Vice Chairman & Chief Executive Officer of Erada.
In Egypt, the number of beneficiaries who have received microfinance loans is on the rise, with a 46 percent annual growth rate according to the end of September 2022, reaching approximately 35.5 billion Egyptian pounds, and 3.8 million beneficiaries, of which 60 percent were women amounting to 2.3 million beneficiaries, and 64 percent were youth.
Hala ElSaid, Egypt’s Minister of Planning and Economic Development and Chairperson of TSFE said that the establishment of Erada is in alignment with the Government of Egypt’s directives to facilitate small and micro enterprises’ access to financing and create additional job opportunities for the youth.
ElSaid noted that fintech-enabled businesses with strong financing facilities support Egypt’s national agenda of digital transformation and financial inclusion across all vital economic sectors to achieve Egypt’s Vision 2030 as well as the United Nations Sustainable Development Goals; namely SDG 5: Gender Equality; and SDG 8: Decent Work and Economic Growth.
Read more: Fintech investments in Egypt reach an all-time high
Ayman Soliman, Chief Executive Officer of TSFE, noted that Egypt is well positioned for an immediate and full launch of its digital economy in line with TSFE’s Financial Services and Fintech Subfund’s strategy of creating value and returns across all sectors and specifically the financial services and fintech sectors, stimulating economic growth and accelerating the transformation process through partnerships with strategic investors.
For his part, Hazem Metwally, Chief Executive Officer of Etisalat Egypt said that Erada will be managed through an independent board of directors. He added that Etisalat Egypt’s investments have reached over 70 billion pounds over the span of 15 years and that it strives towards empowering MSMEs through access to finance and tech-enablement in Egypt through Erada as a result of the partnership with TSFE and the experts in the industry of non-banking financial services.
Additionally, Amr Aboelazm, Cofounder, CEO, and Vice Chairman of Erada said that the company is collaborating with the full ecosystem and beneficiaries including banks, corporates, and entrepreneurs; to provide a gateway to innovative products to support this vital sector in Egypt allowing access to finance, creating jobs and additional income. He added that the company has finalized the requirements with the Financial Regulatory Authority (FRA) and obtained the license to operate in record time.
