The sum of over FCFA 258 billion has been collected as deposits by the 460 microfinance institutions operating in Cameroon from more than one million clients. Since the creation of the first microfinance institution in 1963 in the then North West Province, the microfinance sector has grown, providing over FCFA 22 billion as capital, 15,000 direct jobs and loans worth more than FCFA 138,5 billion to mostly poor people who do not have access to classical banking services.

These 2008 figures were presented by panelists at a panel discussion that was organised last Thursday, February 24 at the Muna Foundation by the Club of Microfinance Institutions, MFIs, managers in collaboration with the Association of Microfinance Institutions in Cameroon, ANEMCAM, under the theme, “Do MFIs contribute to poverty reduction and the development of Cameroon?” Coming on the heels of the collapse of a major microfinance institution, COFINEST, on February 22, and the resulting panic and mistrust felt by many with regards to the microfinance sector, the organisers intended to use the opportunity to enlighten the public on the contributions of the sector to development.

The three lectures presented focused on the impact of MFIs on growth and development, the cost of microfinance services as well as factors that could contribute to increasing the impact of MFIs. To the first speaker, Dr Justin Bomda, the recent global financial crisis demonstrated the growing importance of the finance sector in every economy. In developing countries, he said, where classical banks are unable to assist the majority people in rural areas, the role of MFIs becomes very essential.

The second speaker, Reverend Ombang Ekath, President of ANEMCAM, listed some of the difficulties faced by MFIs such as high fiscal pressure, difficulties in recovering loans, insolvency of clients, bad governance, poor working conditions for some workers and unqualified staff. He listed measures by ANEMCAM to cleanse the MFI sector; notably capacity-building, sensitisation of clients and progressive reductions of loan annual interest rates. While explaining the costs of MFI services, he outlined efforts that were on course to produce a code of conduct for the sector and ongoing lobbying with government for a fiscal policy that is adapted to the realities of the sector.

Questions that followed cast doubts on the governance systems practiced in the MFI sector now infested with clandestine and ill-intentioned operators. Reacting to the recent crash of COFINEST, the speakers held that it was just one case out of 460 and in no way casts a shadow on the highly performant microfinance sector which according to Paul Banouga, the last speaker, could increase its impact on development if certain measures were taken to improve on aspects of governance, communication and administrative-judiciary procedures.