Sunday, June 16, 2024

Afghan Credit Guarantee Foundation partner on first-of-its-kind Credit Risk Scorecard for Afghan SMEs

Creditinfo Group, the leading global credit information and fintech services provider, today announced that it has entered into a strategic partnership with ACGF – Afghan Credit Guarantee Foundation to develop a Credit Risk Scorecard aimed at small-to-medium enterprises (SMEs) in Afghanistan. As the first SME credit scorecard to be developed for the Afghan market, the joint solution will not only increase profitable lending to the market, but also provide a host of societal benefits such as great wealth generation and increased employment, as a result of opening up affordable, formal credit to SMEs in the country.

As a global supplier of credit bureaus and credit risk solutions, Creditinfo has been active in Afghanistan since 2013, in partnership with the Central Bank of Afghanistan. ACGF was established in 2014, following a decade of a successful performance by its institutional predecessor Credit Guarantee Facility for Afghanistan. ACGF operates in Afghanistan with the aim of boosting financial inclusion in the Afghan market by providing credit guarantees and Technical Assistance (TA) to financial institutions with the ultimate objective of facilitating SME lending.

ACGF has been at the forefront of driving the Afghan credit industry forward for 15 years. In the challenging economic and political environment of Afghanistan, the organisation utilises its funds effectively to create wide-reaching developmental impact. Since inception ACGF has cumulatively guaranteed USD 219m of loans, supporting 5,500 SMEs. Furthermore, as per the end of 2018 estimations, 45% of all business loans in Afghanistan have been guaranteed by ACGF.

The partnership between Creditinfo and ACGF will see the development of a cutting-edge technique for assessing the credit risk of SMEs granting credit. It will also enable credit providers to extend credit to SMEs who are currently unable to access credit. The solution will be used at the point of application by SMEs for credit, and will enable lenders to make more informed decisions, and extend more credit than is currently possible.

Creditinfo brings its industry-leading Credit Risk Analytics knowledge and experience to the table, alongside its intimate knowledge of available data in Afghanistan from its work running credit bureaus in the region. ACGF will bring its vast experience dealing with several leading local credit providers to the partnership, which includes a goldmine of data, knowledge and, ultimately, end users for this product.

Mr Benjamin Riley, Senior Global Consultant, Creditinfo, commented on the partnership: “Our unique insight into the Afghan credit market, combined with our previous work with the Central Bank of Afghanistan, will help in creating a robust and reliable measure of SME credit worthiness in the country. This will have a significant positive impact on the national economy, by opening up access to more affordable and stable credit to SMEs. Creditinfo is delighted to be given the opportunity to work alongside ACGF to help the country deliver these much-needed changes.”

Mr Bernd Leidner, Chairman of Management Board, ACGF added: “Globally, SMEs are the driving force behind economic growth, generating employment opportunities and wealth. However, access to affordable and stable credit is a key factor in the success of the sector. Afghanistan is no different in this respect. For years, we have been dedicated to opening up financial access to Afghan businesses. Our next initiative, alongside our trusted partner Creditinfo, will ensure we’re providing the local market with the required tools, consultancy and advice to not just survive, but thrive.”

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