The average amount of credits granted by microfinance institutions in Tunisia has registered an increase of 12.8%, during the period 2015/2020, to reach 1263 dollars, while the assets of the sector have gone up by 20% per year, according to the Arab Monetary Fund (AMF).

The Fund forecasts in its 29th report entitled “Reality and Prospects of Microfinance in Arab Countries” published on May 31, the growth of the microfinance sector to 497 billion dollars, by 2030.

In Arab countries, microfinance has expanded to include insurance, remittance and savings services, the AMF said, adding that the development of financial techniques has made it possible to offer nano finance products in some countries.

It added that the COVID-19 pandemic has caused a decline in available funding and pressure on liquidity, in addition to the regression of portfolios and losses recorded for the first time by the sector in some countries.

Microfinance institutions face several other challenges, including the rising cost of funding sources, unfair competition with banks, excessive leverage, and the need to focus on risk management and disparities in compliance with good governance rules, it said.

The Fund stressed the need to accelerate the digital transformation, the development of women’s empowerment credits, sustainable microfinance to ensure the development of the sector in the Arab region.

In 2021, the number of microfinance institutions operating in 7 countries with data in this field has reached 84.

77% of these institutions are active in Egypt and Sudan, while the rest are distributed among Palestine, Tunisia, Qatar and Saudi Arabia.

Source: TAP News Agency