Post conflict economic and social context
The Democratic Republic of Congo (DRC) is progressively recovering from the war which ended in 2003, although a lack of security still affects some parts of the country. In 2009, the country suffered from a combination of adverse factors: the global financial crisis, the food and livelihood crisis, the drop of the prices of commodities and the insurrection movement, which started over in the eastern part of the country.
In this context, DRC managed to post a 2.9% growth of its output in 2009 and is likely to outperform this mark in 2010, thanks to the hike of the prices of raw materials. However, with an annual demographic growth rate above 3%, DRC struggles to convert economic growth in socio-economic improvements.
DRC ranks 176 out of 182 countries in UNDP’s 2009 Human Development Index ranking.
Unmet demand for financial services
The financial sector in DRC is weak and needs to be reinforced in order to enable it to play a role in supporting the economic growth which is vital for the continued development of the country: less than 2% of the economically active population has access to formal financial institutions; there is one bank branch for 1.2 million inhabitants (against one for 50,000 in Ghana and one for 60,000 in Kenya for instance); the total outstanding loan portfolio in the formal financial system stands at less than USD 700 million. In this context, Micro Small and Medium-sized Enterprises (MSME), which represent over 95% of employment nationwide have almost no access to basic formal financial services.
Advans Banque Congo's objective is to cater for this unmet demand by offering a full range of basic financial products (loans, deposits, means of payment) to MSMEs, starting its operations in Kinshasa before progressively expand to other major cities.